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Thu 14th Feb 2019 - Patisserie Valerie saved by Irish private equity firm
Patisserie Valerie saved by Irish private equity firm: Patisserie Valerie has been rescued by Irish private equity firm Causeway Capital Partners. A total of 96 of Patisserie Valerie’s 121 remaining outlets are to be saved preserving most of the company’s 2,000 remaining jobs, reports The Daily Telegraph. The deal to save Patisserie Valerie was struck at 3am this morning (Thursday, 14 February) and will keep chief executive Steve Francis on board. Causeway Capital was founded by a group of entrepreneurs in 2015 and specialises in small and medium-sized investments. One of its portfolio companies is BB Bakers and Baristas, which operates 65 stores across the UK and Ireland. It is understood Patisserie Valerie will continue to operate as a standalone entity and its stores will not be folded into BB Bakers and Baristas. Patisserie Valerie collapsed in January after failing to agree fresh funding with its banks. Its parent company Patisserie Holdings said its failure was a “direct result” of an accounting fraud that left a £40m hole in the company’s finances. Administrator KPMG shut 70 unprofitable stores at the cost of more 900 jobs. KPMG ran an accelerated sales process for the remaining stores, which was gate-crashed last weekend by billionaire retail tycoon Mike Ashley. The Sports Direct owner subsequently withdrew his £15m offer. Backed by sector investor Luke Johnson, Patisserie Valerie grew rapidly after being bought by his investment firm Risk Capital Partners in 2006. The company floated in 2014 and continued to expand despite facing the same headwinds as others on the high street and leisure sector. But in October last year the company was plunged into crisis when it revealed “significant, and potentially fraudulent, accounting irregularities”. Shares were suspended and Johnson hastily raised rescue funding from investors. Finance chief Chris Marsh was questioned by police with the Serious Fraud Office opening an investigation. Accounting authorities have also launched a probe into the actions of auditor Grant Thornton. Marsh, chief executive Paul May and other members of the board stepped down with the exception of Johnson. An official announcement by KPMG and Causeway Capital Partners is expected later today.

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