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Wed 20th Sep 2017 - Roger Payne paid £210,500 to acquire Chicago Rib Shack in pre-pack administration
Roger Payne paid £210,500 to acquire Chicago Rib Shack in pre-pack administration: Authentic American barbecue restaurant chain Chicago Rib Shack, which operates five sites, was acquired in a pre-pack administration for a consideration of £210,500 plus 50% of the rent deposits for the company’s premises, new documents have revealed. A report by joint administrators Andrew Hosking and Simon Bonney revealed nine parties showed interest in acquiring the company. It was bought by Rib Shack Holdings, which is owned by Roger Payne, the entrepreneur behind Camden Dining Group. All 72 staff working at the restaurants transferred as part of the sale. Of the total amount, £105,000 was received on completion, £55,000 was due to be paid six weeks after completion, and £10,100 was to be paid following assignment of each restaurant lease, as was 50% of the rent deposits remaining at completion. The report said Chicago Rib Shack was launched as a fast-casual dining format at Westfield Stratford City, east London, in 2011. Food court sites in Southampton and Leeds were opened with “mixed success” after £1.7m was raised with Rockpool as backers. As a brand with an average spend above £10 per head, further shopping centre food court sites were considered risky and neighbourhood restaurants were opened in 2014, 2015 and 2016 in Clapham, Twickenham and Aldgate East respectively. Further equity funds were raised in 2015 and 2016 to support the business and group sales had grown to about £3.5m with unit Ebitda approaching £350,000. However, central costs and group overheads meant the group had not reached overall profitability. Sales during 2016 continued to grow but there was increased pressure on margins due to food price increases as well as higher property and staff costs. In December 2016, a further £3m was sought to continue to grow the business but the company had a short-term cash requirement by March 2017. Meetings took place with Rockpool to agree this funding but the company was advised it would not be forthcoming and should look at other options. During April and May, meetings took place with new investors introduced by Venture Consulting and terms were agreed for a cash injection of £300,000. However, the deal did not materialise and the company went into administration on 28 July this year. Draft accounts for the year to March 2017 showed the company has turnover of £4,192,491 with Ebitda of minus £57,824. The report showed director Christian Arden was the sole secured creditor and was owed £104,850.84. Unsecured creditors HMRC and trade and expanses creditors were owed £404,523 and £441,145 respectively.

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