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Wed 23rd May 2018 - Gaucho owner explores sale as it plots CAU cull
Gaucho owner explores sale as it plots CAU cull: Gaucho is exploring a sale of the business as part of a review that includes the closure of its 22-strong CAU brand. Gaucho, which is owned by private equity firm Equistone, is about to initiate talks with potential buyers as it seeks to place itself on a sustainable financial footing amid difficult trading conditions in the casual dining sector. The decision to kick-start a review of options comes just a fortnight after it emerged Gaucho had drafted in advisers to examine whether to close or sell CAU’s 22 restaurants. Gaucho's new management team has now decided to expand KPMG’s mandate to solicit proposals from potential investors for the entire company. Propel understands there is no guarantee a sale will take place. Potential investors will be asked to submit proposals for the business and this could include some or all parts of the business. The management team is trying to get the group on a stable financial footing. The situation remains the same as it was a few weeks ago – the Gaucho restaurants are profitable and the latest two openings are performing well. CAU is the issue and continues to be so – it’s expanded too quickly, with some poor site selection. All of Gaucho’s sites will continue to trade during the review process. In a statement, a Gaucho spokesman said: “Having completed a strategic review and engaged with key stakeholders, the directors have instructed advisers to commence an options process. The process aims to secure a viable long-term structure for the business. This may or may not lead to a sale.” The review comes with CAU seeing double-digit declines in like-for-like revenues. A Company Voluntary Arrangement for the CAU estate remains an option. The Gaucho-branded estate, which comprises 16 restaurants, is said to be performing “in line” with the broader restaurants sector, and is not under threat of closure. The company’s founder, Zeev Godik, stepped down as chief executive in November. He was replaced by Oliver Meakin, who joined from electrical retailer Maplin. Earlier this month, managing director Tracey Matthews announced she was stepping down after 18 years with the business to pursue new opportunities. Latest accounts available at Companies House showed for the year ending 31 December 2016 CAU generated turnover of £25,507,748, compared with £16,869,476 the previous year. It reported a pre-tax loss of £2,449,797, compared with a loss of £901,643 the year before.  


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