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Mon 4th Jan 2021 - Update: Vaccination centres, Caffe Nero, Dermot King and Soho House
Operators offer up premises as vaccination centres: Sector operators, including BrewDog and Loungers, have offered up their sites for use with the roll-out of the covid-19 vaccine. Chief executive and co-founder of BrewDog James Watt tweeted: “Hi Matt Hancock and Nicola Sturgeon. We would like to offer our closed BrewDog venues to help with a quick roll out of the vaccine. For free. We have waiting areas, huge refrigerators, separate rooms for vaccinations and an ace team who can help organise. We want to help.” Watt tweeted a few days later: “We are in talks with the government about using our closed BrewDog bars as vaccination centres. We are also going to give everyone who gets vaccinated at a BrewDog bar a special commemorative beer.” The idea was picked up on by Loungers chairman Alex Reilley, who tweeted: “Great thinking, as always, from BrewDog and one that we’d love to also support – 170 sites across England and Wales (the majority in suburbs and small towns).” William Lees-Jones, managing director of JW Lees, also tweeted: “Brilliant idea – put JW Lees Brewery down for 150 sites too in North West England and North Wales.” At the same time, Kate Nicholls, chief executive of UKHospitality, said: “Hospitality stands ready to help – we have large empty hotels in rural and town centre locations that are covid secure (they housed and fed front-line workers and convalescent patients), with trained first aiders and plenty of fridges. We can be vaccination stations.”

Lord Sugar’s company Amsprop joins a legal fight against Caffe Nero’s CVA: Lord Sugar has joined a landlord revolt against Caffe Nero’s company voluntary arrangement (CVA), a form of insolvency that would allow the chain to close sites and slash rents. Amsprop, the property vehicle owned by Sugar, 73, is among seven parties that have launched a legal battle, according to Sky News. The cost is being covered by Issa and Mohsin Zuber, the tycoons who are buying Asda. They lodged a takeover bid for Caffe Nero before the CVA was approved last month. Amsprop’s involvement in the challenge, which is understood to have been filed on Christmas Eve, will intensify scrutiny of a restructuring that will affect the fate of thousands of high street workers. Under the plans tabled by Gerry Ford, Caffe Nero’s controlling shareholder, landlords would forfeit most of their outstanding rent payments – a move which has angered commercial property owners who have seen their businesses hammered by the coronavirus pandemic. Landlords were, however, promised full payment of rent arrears as part of a takeover offer proposed just before December’s CVA vote by EG Group, the petrol station empire run by Lancashire-based brothers Mohsin and Zuber Issa. The Issas, who are in the process of buying Asda alongside their private equity backers, TDR Capital, are understood to be underwriting the cost of the legal challenge to the CVA. One source said that the landlords who were contesting the restructuring were largely ‘mom and pop’ property owners who would not have the resources to fund a significant legal fight. One disgruntled landlord described the restructuring as “a sham” and said it appeared that board members were conflicted by virtue of their status as shareholders in the company. Caffe Nero’s directors refused to adjourn the CVA vote despite the eleventh-hour emergence of EG’s takeover bid – a refusal contested in court documents. In a statement, a Caffe Nero spokesman said: “We are aware a challenge has been filed by a small number of landlords at what appears to be the instigation of a third party. We still firmly believe the terms of the CVA, which passed with over 90% support, are in the best interests of all our creditors and we will openly engage with any landlord who wishes to discuss it further. We intend to defend the challenge vigorously. In the meantime, we remain focussed on managing the business through the current covid-19 enforced trading restrictions, and re-growing our sales in the months and years ahead.”

King – If you want to save Britain’s towns, give hospitality and tourism a tax break: Dermot King, chief executive of Oakman Inns, has argued that a competitive consumer tax is the route to “confidence, investment and regeneration”. Writing in inews, King said: “Hospitality employs over 10% of the UK workforce overall. Furthermore, typically 60% or more of the workforce is under 25. Tourism is internationally competitive. The boffins at the Department for Culture Media and Sport might think that the UK has a unique product to sell, but so does everyone else. If you want to see history, you can see it in Rome just as much as York, but the UK is expensive. The World Economic Forum bi-annual Travel and Tourism Competitive Index consistently places the UK in the bottom five out of 139 countries for price competitiveness. And so, we come back to the root problem: tax. Our VAT rates on hospitality are between twice and three times more expensive than our competition. To compound these structural issues, we must now add the covid crisis. Hospitality has basically been shut since March. At no point since the initial lockdown have hospitality businesses been able to trade without restrictions despite investing heavily in creating covid-secure environments. Rishi Sunak defends his position by pointing to the unprecedented support provided to the industry. Whilst the furlough scheme has unquestionably preserved jobs (for now), his support package consists of a rates holiday for 12 months, a temporary reduction in VAT on food until 31 March and his famous Eat Out To Help Out scheme. But even if we reopen in March, of the 12-month rates holiday we have been closed for seven months and of the eight months of reduced Vat, we have been closed for four months. That leaves us with 13 days of Eat Out To Help Out in August. This package did not compensate for the destruction of businesses in the summer, never mind Christmas. Hospitality is too important, not just for seaside and market towns, but for the UK as a whole, to be treated so shabbily. At the very least it needs an extension of the rates holiday for a further year, a permanent reduction in the Vat rate on food services and accommodation to 5% and the ability for hospitality businesses to use their corporation tax losses in this year to be set off against their other tax liabilities including Vat and PAYE. A competitive consumer tax is the root to confidence, investment and regeneration. The ambition of our youth depends on it.”

Pandemic forces Soho House founder Nick Jones to cash in $20m stake: Nick Jones, the founder and chief executive of the Soho House chain of private members’ clubs, has cashed in $20m (£14.8m) of his stake after the pandemic brought a halt to the company’s rapid expansion. According to The Times, Jones sold 1% of his holding to Ron Burkle, the Los Angeles-based billionaire who already owns about 60% of the business. The deal was struck at the same $2bn valuation that investors put on the group at a $100m fundraising last summer. It will leave Jones, who established the exclusive club brand in 1995, with a stake of less than 10%. Jones, who withdrew a planned $2bn New York flotation in 2018, now expects earnings before interest, tax and other charges to fall this year from a budgeted £85m to only £5m. Soho House sources said that by taking some money off the table now, Jones would be able to reinvest further in the business if market conditions caused by the virus became more challenging. It also would allow him to make extra contributions to a fund set up to help Soho House staff in need of extra financial support during the coronavirus outbreak. Jones has been contributing 40% of his salary to that fund.

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