Giraffe and Ed’s Easy Diner announce closures
Giraffe and Ed’s Easy Diner have announced that 27 of their 87 restaurants are to close. The restaurants will enter a company voluntary arrangement (CVA) and the move will put hundreds of jobs at risk.
Owners of Giraffe and Ed’s Easy Diner, Boparan Restaurant Group (BRG), said that revenues had improved at the chains since they were acquired in 2016, but many sites remain unprofitable.
BRG CEO Tom Crowley, said of the decision: “The CVA is the only option to protect the company. The combination of increasing costs and over-supply of restaurants in the sector and a softening of consumer demand have all contributed to the challenges both these brands face.”
KPMG are overseeing the insolvency process and the proposal to enter a CVA will be put to a creditor vote.
BRG acquired Giraffe from Tesco in 2016, and then bought Ed’s Easy Diner in a pre-pack administration later the same year. Giraffe and Ed’s Easy Diner are a combined entity, which in its most recent accounts showed annual turnover of £67.1m with losses of £1.6m.
KPMG’s Restructuring Partner, Will Wright, said: “This CVA seeks to address the cost of the company’s leasehold obligations across a number of unprofitable sites, and if successful, will put the business on a surer financial footing.”
Creditors will vote on the CVA process proposal later this month and a minimum vote of 75% will be needed to approve it to proceed.
BRG also owns other restaurant brands that are not involved in the CVA process including the contemporary Indian restaurants and bars Cinnamon Collection, and fish and chip restaurants Harry Ramsden’s.