The owner of Giraffe and Ed’s Easy Diner is to close a third of its restaurants, putting 340 jobs at risk, after creditors approved a rescue deal.
Six Ed’s sites, including those in Bromley and Mayfair in London, and 21 Giraffe restaurants, including in Aberdeen, Basingstoke, Norwich, Reading and Bluewater shopping centre in Kent, are to close in the next few months.
They are the latest casualties of a shake-out in the casual dining market which has resulted in closures at a string of chains including Jamie’s Italian, Byron, Gaucho and Carluccio’s.
Giraffe Concepts, which also includes the Slim Chickens and Wondertree brands, has 80 restaurants, 17 of which are run by franchisees and are not affected by the restructure.
After approval of a company voluntary arrangement (CVA), it is understood the business’s owner, Boparan Restaurant Group (BRG), will inject £10m into Giraffe Concepts, whose main chain has endured a rocky history including a period of ownership by Tesco.
Boparan Holdings, which owns BRG and 2 Sisters Food Group, the country’s largest supermarket chicken supplier, acquired Giraffe from Tesco in 2016 in a deal valued at about £13m. The company then paid almost £10m to acquire 30 Ed’s sites out of administration that same year.
The companies were combined into Giraffe Concepts, which generated revenues of £67.1m in 2017 but made a loss of £9.9m, according to its latest accounts.
More than three-quarters of the company’s creditors approved the rescue deal, which also includes rent cuts on 17 outlets, at a meeting on Thursday.
Will Wright, a restructuring partner at KPMG and joint supervisor of the CVA, said: “This is a critical step forward for the business, allowing Giraffe Concepts to complete its financial restructuring plan and embark on a comprehensive operational transformation programme.”