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Fri 3rd Jul 2020 - Exclusive: Wasabi considers funding options including possible sale
Exclusive – Wasabi considers funding options including possible sale: Wasabi, the sushi and bento chain led by Henry Birts and backed by Capdesia, is looking to secure new investment that could include a sale of the business, Propel has learned. The company appointed restructuring advisers KPMG in May to explore a full range of strategic options, which now includes seeking potential new investment partners or a purchaser for the business alongside raising funds from existing investors. The company operates 51 high street-based sites in the UK as well as two Kimchee sites and five restaurants in the US. The company initially appointed KPMG to assist with discussions with landlords regarding rental arrangements. The business, which was founded in 2003, is looking to move towards a variable, turnover-based system with regard to rent on its 51 stores, 42 of which are in London and heavily reliant on office workers and tourists. It is currently in the middle of its reopening programme under government guidance on social distancing and hygiene safety. It’s thought early customer demand and feedback has been encouraging but sales are still a long way off previous trading levels. Last month Birts told Propel: “This is a very challenging time for our industry and the future for all of us is highly uncertain. Before covid-19 we had a thriving brand and business, known for its high-quality, fresh, fast and excellent-value offer. There is now a big question mark over how and when demand will recover and, as it does, we then have the challenge of managing capacity and speed of service in our kitchens and front of house alongside restrictions around social distancing. We are working extremely hard to flex our operating model in light of this uncertainty but this isn’t going to work unless our fixed costs, primarily our rent, also reflect this economic reality. It is nevertheless our belief that with the support of all our stakeholders, including our landlords, we can adapt to once again be a healthy and sustainable business, preserving jobs, playing our part in the broader economic recovery, and continuing to serve our customers safely and efficiently.” In May 2019, investment firm Capdesia made a significant equity investment to recapitalise Wasabi, reduce its level of debt – with the continued support of existing lender HSBC – and, as it said at the time, “lay the foundations for an exciting growth plan over the coming years”.

UKHospitality issues open letter to customers as it warns of ‘unthinkable’ consequences: UKHospitality has urged the public to “play its part” in an open letter to customers ahead of tomorrow’s (Saturday, 4 July) scheduled reopening of businesses. The letter makes customers aware of the measures businesses will have implemented to deliver a safe reopening as well as any changes customers should expect to notice. It also highlights how customers can play their part to ensure reopening is safe, successful and enjoyable. Part of the letter states: “To coin a phrase, we are all in this together. We need you to play your part in our joint battle against the virus. The consequences of getting the unlocking of hospitality wrong are unthinkable. Most seriously, a spike in virus cases causing ill-health to our friends, families and communities and, secondly, the real threat of local and national lock-downs, removing your freedoms, shutting down our businesses and job losses.” UKHospitality chief executive Kate Nicholls said: “It would be an understatement to say the past few months have been a challenge for our sector. Venues in England are very excited to welcome back customers but clearly that is also going to present some challenges. Businesses are conscious of the important role they will play in ensuring the safety of staff and customers, as much as they are aware they are likely still not out of the woods economically. It is vital this reopening is safe, successful and helps to imbue confidence among customers. Our customers also have a huge role to play – success depends on co-operation. Everything must run as smoothly as possible to ensure everyone is kept safe and prevent further potential closures, which nobody wants and could be terminal for some of our favourite venues. We hope this open letter will give customers clarity about what to expect of venues and what is expected of them. We want to reassure them every effort is being made to make sure their visit to a pub, cafe or restaurant will be the best it can possibly be.”

Tasty explores ways to strengthen balance sheet as it announces 284 redundancies: Tasty, the AIM-listed operator of the Wildwood and Dim T brands, has revealed it is exploring ways to strengthen its balance sheet as it announced 284 redundancies. The company said the move affected restaurant and head office staff and represented almost one-third (32%) of its total workforce. Tasty stated: “Given the anticipated drop in footfall due to the continuing restrictions imposed as a result of covid-19, the board has come to the difficult decision that staff numbers need to be reduced accordingly. Clearly this decision has been very difficult for everyone involved and throughout this process our priority has been to support those who have been affected. The board of directors is exploring ways to minimise costs and strengthen the balance sheet including investigating the possibility of new debt and/or equity capital and discussing terms with landlords and trade creditors. Further announcements will be made as and when appropriate.” Earlier this week Tasty said it expected to have circa 25 sites trading again by mid-July as it “cautiously” reopened the estate. The company has so far reopened seven restaurants – about 13% of the total estate – for takeaway only.

BrewDog to open entire English estate tomorrow: Scottish brewer and retailer BrewDog will open its entire estate of bars in England tomorrow (4 July). It will follow this by reopening external areas in its Scottish bars on Monday (6 July). To ensure a covid-secure reopening in line with government guidance, the company said it had implemented its own ten-point safety plan, including contactless ordering and cashless payments via its order to table app, sanitiser stations and social distancing signs. All staff will be required to wear masks and gloves, while they will also monitor capacity continually and carry out surface cleaning every 15 minutes. The sites will also feature single-use menus, while table screens will be available on request. Last week BrewDog announced it would reopen three of its UK sites, which have licences until 3am, at one minute past midnight on 4 July. The company said it would open its bars in Shoreditch, Manchester and Newcastle at that time. They will be ticketed events, with all proceeds going to the charity Hospitality Action.

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