Questions over Little Chef future as owner sells restaurants
The owner of Little Chef has struck a deal to sell the roadside diner's chain of restaurants, sparking questions over the brand's future.
Kuwait-based Kout Food Group (KFG) has sold the usage rights to Little Chef and 70 of its restaurants to Intervias, the parent company of Euro Garages.
It is part of a wider deal which will see 78 roadside sites and more than 120 outlets - including Burger King and Subway - shift across to Intervias for an undisclosed sum.
However, KFG, which paid £15 million for Little Chef in 2013, will continue to own the brand rights to the roadside diner.
Intervias said it will explore opportunities to bring new brands to the sites, fuelling speculation that it may seek to close down some Little Chef restaurants and replace them with rival roadside outlets, such as Starbucks, Greggs or KFC.
" This transaction forms part of our growth plan to acquire and develop strategically-positioned sites, allowing us to bring a portfolio of market-leading brands to consumers and communities across the UK and elsewhere in Europe," a spokesperson for Intervias said.
KFG stopped Little Chef disappearing from the roadside three years ago when it snapped up the restaurant chain from turnaround firm RCapital.
RCapital had acquired Little Chef for a nominal fee in 2007 after it collapsed into administration before an overhaul including a menu revamp by celebrity chef Heston Blumenthal. It said it had brought the business back into profitability.
A spokesperson for KFG said: "As part of its commitment to the communities in which it operates, KFG has ensured employment for all its roadside employees and is confident that Euro Garages will continue to develop the strength of the people and roadside brands."
As part of the deal, around 1,000 staff will also transfer from KFG to Intervias.
Famous for its large "Olympic" breakfasts, Little Chef began life as an 11-seat restaurant in Reading, Berkshire in 1958.
Euro Garages has 341 freehold-owned sites across the UK and operates around 70 Starbucks cafes, 146 Subway outlets and 100 Gregg's bakeries.