British burger chain Byron has today announced a series of proposals aimed at saving the business: a strategy that a number of news outlets are reporting will mean the closure of between 15 and 20 sites. It follows the news in December that 13 sites had been identified as loss-making or marginal, and labelled as “exit immediately” in materials given to prospective buyers of the struggling brand.
Sky News announced today that the company “was seeking a so-called company voluntary arrangement (CVA) aimed at slashing costs, including rent bills, following a strategic review of the business.” As part of the restructuring process, Byron have identified 20 sites — nearly one third of its estate — at which it will pay reduced rent to landlords while negotiating its future, and it is expected that many of those sites will close as a result of the process.
Byron’s demise has been played out rather publicly over the past months as representative of the problems facing the casual dining sector and its larger, less agile businesses in a post-Brexit climate of fiscal uncertainty and rising costs, and has also suffered a downturn in trade as the sector has become more saturated and more competitive.
Chief executive Simon Cope said of the current proposal: “Byron’s core restaurant business and brand remain strong but the market that we operate in has changed profoundly. In order to continue serving our loyal customer base, we need to make some critical and difficult changes to the size and shape of our estate.”
The proposed CVA is the last step in completing a financial restructuring of the company that will see existing investor Three Hills Capital Partners become majority shareholder, taking the reigns from Hutton Collins who, having bought the then 34-site burger chain in 2013, will remain a minority partner.
KPMG, in charge of the CVA and restructuring negotiations, was adamant that no restaurants would close on day one of the CVA, and that Byron’s obligations to their 1800 staff, suppliers and business rates would continue to be paid in full, and on time.