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Tue 9th Oct 2018 - Burning Night Group goes into administration, offers on table to buy company
Burning Night Group goes into administration, offers on table to buy company: Bar company Burning Night Group has gone into administration but there are already offers to buy the company, Propel has learned. Begbies Traynor has been appointed as administrator by crowdfunding platform Crowdstacker, which is the main secured creditor of Burning Night Group. Propel understands there are at least two offers on the table to buy the company. The Bierkeller bars are understood to remain profitable but a number of cost headwinds are thought to have created cash flow issues for Burning Night Group. The company closed its Bierkeller in Cardiff in August. The ongoing negative impact of a regeneration scheme in the city centre was cited as a major factor in the decision to cease trading. However, Propel understands the other five Bierkeller Entertainment Complexes in Leeds, Liverpool, Manchester, Birmingham and Nottingham, which have experienced high growth during the past financial year, will continue to trade unaffected and further growth is expected within the next 12 months. Employing more than 500 staff nationwide and with an annual revenue believed to be in excess of £25m for 2017-18, Bierkellers are a large part of the operational business of Burning Night Group. Propel understands the companies owning the Bierkeller leases are not in administration, while management and lenders are working together to continue to trade the assets to their full and might consider a sale to realise funds to clear down some or all of the debt. It is understood further problems have been caused by subsidiary company Cornertrack, which was a guarantor to the peer-to-peer loan, being issued with a notice to appoint an administrator. Due to this, Burning Night Group offered replacement security and the initial intention was the loan would remain unaffected. However, this resulted in further creditor pressure across the group. As such, Crowdstacker decided to enforce its security and appoint an administrator of Burning Night Group. Potting Shed and Firepit Smokehouses, which are a joint partnership between Downing and some Burning Night Group directors, is believed to be unaffected, as is pub development company Authentic Alehouses, which is led by Burning Night Group chief executive Allan Harper. The last independent valuation of the main large trading bars was undertaken in December 2016, which valued them at £8.79m on a fair value basis. As part of the process, Crowdstacker is thought to be seeking to undertake an updated valuation.


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