Mexican restaurant brand Chilango acquired out of administration for £1m:Mexican restaurant brand Chilango was acquired out of administration last month by investment group RD Capital Partners for £1m, Propel has learned. The deal secured ten of Chilango’s 11 restaurants and preserved about 130 jobs, with managing director Richard Franks, who took over running Chilango in February, continuing to lead the business. The £1m paid for the business includes £829,991 in goodwill (£402,407 consideration, £427,584 secured debt rollover). The administrator’s report showed ten parties made an offer for the business, which underwent a company voluntary arrangement (CVA) at the start of this year, but that follow-up conversations were held with just six of these. Interested parties in all or part of the business were thought to include RCapital, Imbiba and Tortilla. Following further discussions, administrator RSM concluded the preferred bidder was RD Capital Partners. The report stated: “It was subsequently confirmed by the secured creditors and, as such, they would only look to roll over their debt in respect of this offer.” It also states the purchaser had committed a further £375,000 investment to assist with the business’ working capital requirements following completion of the deal. Pre-administration, the company had engaged Harper Dennis Hobbs to liaise with landlords in an attempt to consensually negotiate a reduction in its current CVA rent levels and associated arrears. However, they were unable to gain the “required traction”. The report stated: “The directors were of the opinion they would not be able to trade out of this situation and a further restructuring was required. This was due to levels of debt, which were considered unsustainable. Management reported the following debts: HMRC £1.6m, landlord to September 2020 £579,000, and other unsecured creditors circa £6.4m. The directors anticipated that once the current government protection/moratorium ended, the company would have been subject to creditor action from which it could not recover.”
Eataly plans winter opening for first UK site: Eataly, the Italian food emporium, plans to open its first UK site this winter, complete with three restaurants, four bars and a gourmet grocery market. The opening at 135 Bishopsgate, in the City of London, will feature the Terra restaurant, which is described as the “jewel in Eataly London’s crown”. Terra will be a wood-burning Italian grill restaurant inspired by “earth, gin and fire”. The store will also feature fresh market Italian restaurant Cucina Del Mercato and quick service restaurant Pronto. There will also be fresh counters and a bakery. The London store will host around 400 employees. Founded in 2007, Eataly is the world’s largest artisanal Italian food and beverage marketplace. In 2018, it signed a deal with British Land to open a 42,000 square foot venue at 135 Bishopsgate. The food market will occupy a double-fronted unit on the ground floor of an office building in Bishopsgate, which is located close to Liverpool Street station. Eataly’s market will be on the ground and first floors of the building.
@Pizza hits £820,000 crowdfunding target within six hours of campaign launch to support UK’s first drive-thru pizza concept: Edinburgh-based pizza concept @Pizza has hit its £820,000 target on crowdfunding platform Crowdcube within six hours of the campaign launch to support the UK’s first drive-thru pizza concept. The raise is taking the form of a convertible loan that will earn 10% interest per annum until it converts. Convertible loan holders will have an option to convert their capital into shares at a 25% discount if @Pizza raises equity within the next 36 months. The funds will be used to expand through a mix of permanent sites and semi-permanent outlets – the latter of which will be drive-thrus in the form of shipping containers. So far, 246 investors have pledged £905,430 and the campaign is “overfunding” with 30 days remaining. As previously reported, @Pizza – which currently has two restaurants, in Edinburgh and Birmingham – is looking to build a portfolio of 20 to 30 sites across the UK in four or five “clusters”. The shipping containers will occupy spaces of between 22 and 30 square metres. The drive-thrus would be able to make up to ten pizzas a minute, with customers offered unlimited options to customise. They would be able to order via an app with the option of collection or delivery to their vehicle. @Pizza is also due to open a site at the St James Quarter development in Edinburgh.
Rosa’s lines up Greenwich opening: TriSpan-backed Rosa’s Thai Cafe is looking to further expand its presence in the capital, with an opening in Greenwich. The 20-strong group is believed to be in talks to take the former Saigon restaurant unit on Nelson Road. The Gavin Adair-led business recently opened its 20th site, in Queensway, as part of the West Walk Estate next month. It will follow this with an opening in The Cut, Waterloo, in October. The company has reopened all of its restaurants for dine-in after keeping several open in the capital for delivery and collection during lock-down. It also operates two delivery kitchen sites with Deliveroo, in Blackwell and Crouch End. It also has a site lined up at the new Paradise development in Birmingham alongside Dishoom and Vinoteca.
Heavenly Desserts is sweet on Time Square development for 30th site: Artisan dessert restaurant Heavenly Desserts will open its 30th site, in the £142m Time Square development in Warrington. Heavenly Desserts has secured a 1,500 square foot double-fronted unit on the corner of Dolmans Lane and Bridge Street. Heavenly Desserts director Mohammed Imran said: “The vision of what is here at Time Square is exactly what we’re looking for and we can’t wait to open and serve the town.” Time Square has been delivered by Warrington & Co on behalf of Warrington Borough Council, with urban regenerator Muse Developments as the scheme’s development manager. Muse development director Leon Guyett added: “The signing of Heavenly Desserts highlights, despite these unprecedented times, there’s still confidence in the market for innovative mixed-use schemes delivered through strong partnerships with a shared vision that offer well-designed buildings, which all comes together to create a destination. We’ve got a thriving new market, The Botanist and the Cineworld cinema, Gravity to open towards the end of the year and two further units under offer too.” According to a report by marketing, technology and data company CACI, Time Square will increase Warrington’s catering market potential by 14% to £68.5m making Warrington a top ten dining destination in the north west. Metis Real Estate Advisors acted on behalf of Warrington & Co. and Muse Developments. Rawstron Johnson acted for Heavenly Desserts.
Goodbody – M&B fourth-quarter performance better than expected: Goodbody leisure analyst Paul Ruddy has said Mitchells & Butlers (M&B) fourth-quarter performance was better than expected. In its pre-close trading statement, M&B said total sales over the 51 weeks in the year to date have declined by 35.4%, which Ruddy said suggested full-year revenue of £1.45bn to £1.5bn versus his expectation of £1.38bn. He said: “This was driven by better like-for-likes than we anticipated during the reopening phase, particularly in September. Liquidity remains at a similar level to the July update with circa £100m of cash balances and £140m of undrawn committed unsecured facilities (£250m in July). We had expected a small cash inflow in the fourth quarter so this indicates that net debt is slightly higher than our expectations (£2.25bn pre and £1.7bn post IFRS16). We believe M&B can break even at between 60% to 65% of prior year sales so it should be cash flow-positive despite the curfew restrictions. In this context, the £240m of available liquidity is reassuring, but a further lock-down of the sector would create challenges. The group previously highlighted a £30m to £35m monthly cash outflow before debt service during the lockdown phase, but this included furlough benefits. We value M&B on 6.8 times EV/Ebitda and seven times price-to-earnings ratio both applied to FY22 forecasts and discounted by a year. This is one standard deviation below five-year averages to reflect the covid risks that will continue to impact the sector. M&B trades on ten times FY21 and five times FY22 earnings per share and eight times and six times EV/Ebitda so represents a value way to play the recovery in eating and drinking out.”
Bao group targets King’s Cross opening in November for fourth site: Shing Tat Chung, Erchen Chang and Wai Ting Chung, who founded Taiwanese steamed buns concept Bao are to launch their fourth site in November. Originally planned to open in May, Cafe Bao has been inspired by western-style cafes commonly found in Asia and will feature a counter specifically for Bao bakery goods. The all-day cafe will feature breakfast for the first time at any of the group’s sites too. The restaurant will take reservations and also offer home delivery and click and collect from its Pancras Square base. Co-founder and food art director Chang said: “The inspiration for Cafe Bao stemmed from Yoshoku cuisine, an interpretation of western food, seen through an Asian lens. This style of cooking is something that’s always resonated with us and made us feel quite nostalgic. After a recent trip to Taipei, Hong Kong and Osaka, we realised we wanted to bring it to life.” On the menu, diners can expect Hamburger Bao, Lobster Bao and Fried Chicken XO Butter Kiev. Desserts will include Lonely Pudding – Bao’s iconic lonely man embodied in a creme caramel flan and BAOfiteroles, featuring Horlicks ice cream with chocolate sauce. The bakery aspect will allow customers to take away goods such as Molten Chocolate & Salted Egg ‘Muffin’ Bao, Salted Caramel Bao Cookie and Pizza Bao, plus limited edition celebration items. There will also be a customisbale bao making service, as well as a series of workshops. The counter will also serve bubble tea and coffee to take away.
Former ASK Italian and KFC executive secures £1m funding to launch healthy eating app: Tech start-up Smash – the brainchild of former ASK Italian managing director Chris Holmes – has secured £1m in funding from Guy’s and St Thomas’ Charity to launch an app that aims to fight obesity in 13 to 24-year-olds. The app, expected to go public early next year, will offer up to 20% off on healthier food options at food-to-go retailers. Holmes, who has London child obesity tsar Paul Lindley on board with the Smash (Save Money And Stay Healthy) scheme, came up with the idea of the app while working at KFC as a board member. He realised a system that bans the bad and doesn’t promote the good could be slow at effecting change. He said: “We are already actively engaged in conversations with a number of the UK’s leading food-to-go and restaurant brands in order to nudge Smash users into a surprisingly broad range of lower-calorie options with up to 20% discount on all healthier items. It’s a straightforward idea applied to a massively complex problem shaped by environment and income inequality. So we need to change the dynamic and make healthier food the cheaper and most accessible option – essentially we plan to be the Young Person’s Railcard for healthy food – albeit digital, free and fun.” Kieron Boyle, chief executive of Guy’s and St Thomas’ Charity, the London-based urban health foundation, added: “The places kids hang out are flooded with prompts to eat unhealthily – especially in poorer areas. We need new thinking like Smash to put healthier food centre stage.”
Cineworld revenues slump and may need to raise money if restrictions tighten again: Cineworld has warned further covid-19 restrictions or film delays may force it to raise cash as revenue plummeted. Although it had reopened 561 out of 778 sites worldwide as lock-down restrictions eased, its balance sheet has suffered a $1.6bn (£1.26bn) loss for the six months to June when cinemas were closed during lock-down. Cineworld said: “There can be no certainty as to the future impact of covid-19 on the group. If governments were to strengthen restrictions on social gathering, which may, therefore, oblige us to close our estate again or further push back movie releases, it would have a negative impact on our financial performance and likely require the need to raise additional liquidity.” Six of its theatres remain closed in the UK after being forced to shut in March. The closures meant group revenues sank to $712.4m (£560m) in the first six months of the year, compared with $2.15bn (£1.69bn) during the same period in 2019. Cineworld said it was still in talks with creditors to negotiate waivers on banking agreements, which are due in December 2020 and June 2021. It added recent trading had been “encouraging considering the circumstances”, with Christopher Nolan’s spy film Tenet, which was released early in September, being a highlight.
PizzaExpress launches two variants to its ‘Classic’ range to cook at home:PizzaExpress has boosted its “Classic” range by adding two nine-inch pizzas to its portfolio. The Fiorentina and Quattro Formaggi flavours will be available at Waitrose & Partners from Tuesday (29 September) with a recommended retail price of £5 each. The line-up available now comprises six nine-inch pizzas and four 12-inch recipes. PizzaExpress also claimed it sells 30 million pizzas in UK supermarkets every year. Head of retail Richard Mills said: “Since the launch of our retail business in 1998, we have gone from strength-to-strength, offering customers a selection of quality products across various categories that have proven to be incredibly popular. This is the first new launch for our Classic range for a few years and with an increase in customers recreating the restaurant experience at home, we’re confident that they will prove to be extremely popular with customers.” The Fiorentina is topped with garlic spinach, black olives, mozzarella and passata; while the Quattro Formaggi lists passata, mozzarella, mature cheddar, pecorino and provolone cheese as ingredients.
Honest Burgers expands ‘Honest at Home’ kit range: Active Partners-backed Honest Burgers has added two new kits to its “Honest at Home” range – the vegan Plant variant and signature Tribute burger have joined their Honest burger kit sibling. The Plant kit contain everything needed to replicate the restaurant’s best-selling vegan burger: plant-based patties, vegan smoked Gouda, Rubies in the Rubble chipotle “mayo”, mustard, red onion and homemade pickles. The Tribute burger set contains Honest beef patties, homemade relish and pickles, smoked bacon, burger sauce, French’s mustard and American cheese. Although the company said lettuce and chips have not been included because they do not travel well, it has included complimentary homemade rosemary salt to season customers’ own chips. Each pack is available as a pack of two or four burgers, the option of gluten-free buns and a reusable Honest Tote bag. The Plant kit costs £17 plus £6 delivery for a two-pack and £27 plus £6 delivery for a four-pack. Prices for the Tribute and Honest kits are £15 plus £6 and £24 plus £6, respectively. Deliveries are available nationwide and seven days a week.
Greene King raises funds for Macmillan with face mask drive: Brewer and retailer Greene King has introduced the sale of disposable face masks in its pubs, with all profits being donated to its national charity partner, Macmillan Cancer Support. The move follows the government’s new rules introduced this week, which include the mandatory use of face coverings in pubs unless the customer is seated at a table and eating or drinking. The face masks will be offered for sale for £1 to those guests who arrive without a face covering. The company’s annual Macmillan May campaign was put on hold this year and transferred to September instead. So far, in just three weeks, Greene King has raised more than £400,000 for the charity.
Pizza Pilgrims lands award for DIY pizza kit during lock-down: Pizza Pilgrims, the London-based sourdough pizzeria concept founded by brothers James and Thom Elliott, has won an award for its entrepreneurial take on DIY pizzas. The business has been named Pivot Entrepreneurs of the Year for London and the east of England at the Great British Entrepreneur Awards – and will now go on to a national final. Pizza Pilgrims realised its sales through Deliveroo were failing to break even during at the start of lock-down so the brothers launched a DIY pizza kit for customers at home and sales soared. Now in its eighth year, the Great British Entrepreneur Awards in partnership with Starling Bank celebrate the hard work and inspiring stories of entrepreneurs in the UK, rather than the business’ balance sheet. The Pivot Entrepreneur of the Year category was added in response to the outbreak of Covid-19 and subsequent lockdown measures. It celebrates those who have adapted their business to ensure they survive and thrive after the crisis.
Bibendum signs up as official wine partner to London Restaurant Festival: Drinks distributor Bibendum will be the official wine partner of the London Restaurant Festival, which runs from Thursday, 1 October until Saturday, 31 October. Bibendum will provide the festival, which will take place in the form of restaurant takeovers and restaurant-quality food at delegates’ homes, with an exciting range of wines from its portfolio to pair with the menus of more than 60 culinary events. Simon Davis, founder of London Restaurant Festival, which has taken place annually across London since 2009, said: “We are extremely pleased to have a wine business of such distinction as Bibendum come on board as the official wine. Since the London Restaurant Festival experiences are now all paired with wine, it makes sense. We’re now working closely with Bibendum to select an inspiring selection of wine to star alongside menus at 50 of London’s leading restaurants.” Bibendum chief executive Michael Saunders added: “At a time where it is extremely difficult for wine producers to put their wines in front of consumers and the restaurant trade, we are delighted that we can provide an opportunity for them to showcase their wines at such an exciting series of events.”
Bibendum is a Propel BeatTheVirus campaign member