Giraffe and Ed’s Easy Diner gain approval to close 27 restaurants
The restructuring plans will cause an estimated 340 job losses.
Giraffe and Ed’s Easy Diner will close 27 restaurants after a restructuring plan gained approval, triggering hundreds of job losses.
Around 340 of 1,300 staff are expected to lose their jobs as a result of the move.
Creditors have thrown a lifeline to the casual dining brands by voting through a Company Voluntary Arrangement (CVA), which will also give the chains rent reductions on 13 sites.
Will Wright, 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.”
The business, which is owned by Boparan Restaurant Group (BRG), first proposed the plans earlier this month.
Tom Crowley, CEO of BRG said: “We are pleased to announce that the CVA has been approved and we can now begin to execute our plan. We thank our creditors who have supported the business through this process.”
The company said that although like-for-like sales had improved at the brands since they were acquired, several sites remained unprofitable.
BRG owns a number of other household names, including fish and chip restaurant Harry Ramsden and the upmarket Cinnamon Collection.
It is also the master franchisee for US brand Slim Chickens, which first opened in the UK last year.
BRG acquired Giraffe from Tesco in 2016, and later combined it with Ed’s Easy Diner, which it had bought in a pre-pack administration that same year.
The two brands form a combined entity, which in the most recently available accounts had annual turnover of £67.1 million.
In the same period, underlying losses came to £1.6 million.
Last year, several casual dining brands overhauled their businesses, with some closing sites, amid rising costs and tougher competition in the sector.
Prezzo, Jamie’s Italian, Byron, Carluccio’s, Gaucho and Gourmet Burger Kitchen all shut restaurants.