Bakery chain Patisserie Valerie has been saved from administration by its management after a buyout effort found support from a private equity firm.
First reported in the Telegraph, the deal struck early this morning, will rescue 96 of the company’s 121 remaining stores and preserve most of its 2,000 staff.
READ: Patisserie Holdings in crunch talks with banks over debt extension
The buyout was supported by Causeway Capital, an Irish firm that owns coffee house chain BB Bakers and Baristas, which operates 65 stores across the British Isles.
Causeway said that it was “delighted” to partner with the company and looked forward to “helping the business return to growth”.
Patisserie Valerie is a heritage brand, much loved by its loyal customers. We are delighted to partner with the team and look forward to helping the business return to growth.https://t.co/phL1Og7nLR
— Causeway Capital (@CausewayCap) February 14, 2019
The incumbent chief executive Steve Francis, who was hired in November to replace Paul May, is among members of the executive management spearheading the buyout.
Francis said that he and other managers would own more than “the usual 10%” of the firm but would not have control of the company.
It also follows a £15mln gatecrash bid for the chain by Sports Direct International PLC’s (LON:SPD) Mike Ashely last Friday, although it was quickly withdrawn on Monday.
The acquisition is a rare piece of good news for the company, which collapsed in January after an accounting scandal in October left it with a £40mln funding hole and scrambling for cash.
Despite a £20mln funding injection from the company’s executive chairman, Luke Johnson, the company entered administration after failing to secure a finance package from its banks.
-- Adds Causeway Capital statement and executive details --