Famous Brands pushes through restructuring of UK chain
Creditors back fast-food operator
The restructuring of a fast-food operator Famous Brands’ UK-based Gourmet Burger Kitchen (GBK) passed an important milestone when its creditors approved the group’s turnaround plan. Famous Brands bought GBK for £120m in 2016, but its poor performance has led it to write down R874m. When it bought GBK and its 97 stores from Nandos, the move was widely approved, but the slowdown in the economy, along with the uncertainty created by the UK’s decision to leave the EU created a hostile trading environment. The premium burger market had also become overtraded. The group acknowledged that operating issues such as “sub-optimal management capacity” resulted in its underperformance. In an effort to turn around its struggling UK operation, Famous Brands announced in October that it was going through a company voluntary arrangement (CVA) process, with the assistance of Grant Thornton. A CVA allows a company to restructure by negotiating with its creditors. Famous Brands negotiated its property ...
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