Salans has scooped the lead role advising turnaround expert RCapital on the rescue of struggling UK roadside restaurant chain Little Chef.
Private equity house RCapital brokered a last minute deal yesterday (3 January) to acquire 194 of Little Chef’s restaurants from the People’s Restaurant Group’s for an estimated £10m.
The deal followed shortly after PricewaterhouseCoopers was formally appointed as the administrators to the People’s Restaurant Group, which owned 235 Little Chef restaurants. The remaining 40 restaurants remain in the control of the administrators.
The People’s Restaurant Group had suffered losses estimated at £3m over the last year, in part due to a £59m sale and leaseback deal with property investment company Arazim Investments on 65 freehold sites in February 2005. As part of the latest rescue bid and sale, Little Chef’s rental arrangements have been revised.
Salans, led by partner Bryan Green, advised RCapital on the majority purchase of the business, which currently employs 4,000 people. Green said: “There have been many legal and commercial issues to address in a relatively short period of time.”
DLA Piper, led by Yorkshire head of business support and restructuring Mark Jackson, is advising PricewaterhouseCoopers. The instruction follows the firm’s advice to the People’s Restaurant Group, owned by catering entrepreneurs Lawrence Wosskow and Simon Heath, on its original £52m acquisition of Little Chef from Permira in 2005.
Arazim was advised by Fladgate Fielder.