Leon receives CVA approval: Creditors of natural fast food brand Leon have approved a plan to restructure the firm’s finances through a company voluntary arrangement (CVA), preserving 670 jobs. A total of 90% of creditors approved proposals put forward by business advisory firm Quantuma on behalf of Leon. Quantuma’s Andrew Andronikou and Brian Burke will now act as joint supervisors to oversee the CVA process. The CVA is focused upon ensuring the business can deal with ongoing uncertainties created by the pandemic, and provide a platform to return to its previous positive trajectory, with creditors have accepting a proposal aligned to turnover-based rents. Leon was founded in 2004, and has expanded rapidly to operate 75 sites globally both owned and franchised. The company-owned restaurants in the UK total 44, in prime locations and transport hubs, predominantly across central London. In the year to 30 December 2019, Leon achieved revenues of £76.3m and strong operating profit, and planned to open 30 new restaurants in 2020, most of which had already been identified. Despite starting 2020 as a profitable and growing business, the impact of the covid-19 pandemic saw Leon experience a reduction in sales as a result of the significant reduction in the number of city centre workers attending their offices, limited domestic and international tourists, as well as the impact of measures designed to limit the spread of the disease. Founder John Vincent said: “I would like to thank all the landlords and everyone else who has supported us through this process. This gives us the platform to rebuild Leon and return it to growth.” Andronikou added: “We are pleased the majority of creditors have supported the proposals, which will enable us to work with the business as it recovers and provide a strong foundation from which it can return to the strong growing business it was in 2019. The CVA has been structured in a way to support Leon while it continues to be affected by reduced footfall and the ongoing uncertainties as measures continue to be deployed to deal with the covid-19 pandemic, whilst delivering the best possible outcome for creditors.”

 

Star Pubs & Bars appeals £2m PCA fine: Heineken-owned Star Pubs & Bars has appealed against the £2m fine handed by the pubs code adjudicator (PCA) into “seriously and repeatedly breaching the Pubs Code over almost three years”. The company was fined by Fiona Dickie following an investigation into suspected breaches for offering unreasonable stocking terms to tenants seeking to go free-of-tie. The PCA found the company had committed a total of 12 breaches with the result that it had “frustrated the principles of the Pubs Code”. At the time Dickie said the fine would “act as a deterrent to Star Pubs & Bars and other pub-owning businesses she regulates from future non-compliance”. However, Star Pubs & Bars has confirmed it has appealed against the decision. Managing director Lawson Mountstevens said: “We are deeply disappointed and frustrated at the outcome of the PCA’s investigation. There are many aspects of the report that we fundamentally disagree with and we have lodged an appeal with the High Court. This penalty is unwarranted and disproportionate, and comes at a time when the entire sector is in serious financial crisis as we work around the clock to support our pubs and licensees to keep their businesses afloat. We are a responsible business that takes its regulatory obligations extremely seriously and strives to achieve the highest levels of professionalism. From the outset we have been transparent and repeatedly sought guidance from the regulator on the terms we were offering those licensees looking to take up the Market Rent Only option, but the PCA consistently declined to respond to those requests. Instead it chose to launch a long, costly and unnecessary investigation. We are dedicated to the pubs code in both word and spirit, and do not believe the investigation accurately reflects the culture of our business or the good working relationship we have with the vast majority of our licensees.”

German Doner Kebab opens 50th UK site: German Doner Kebab (GDK), the flagship concept of Hero Brands, has opened its 50th UK restaurant in the UK. The brand has reached the landmark following the launch of the site in Peterborough. GDK has forged ahead with growth during the coronavirus pandemic, opening 13 restaurants and creating in the region of 500 jobs. Locations opened in 2020 include Nottingham, Bradford as well as additional sites in London and Edinburgh. Now employing more than 1,500 people, GDK has a development pipeline of 350 franchise units over the next seven years. Chief executive Imran Sayeed said: “Reaching 50 restaurants in the UK is a huge moment in our story and represents a huge achievement for everyone in the GDK family. We have found ourselves in very challenging times, however, we have remained agile and responsive to a fast-changing landscape, reaching our customers in new ways and developing exciting new products. We are now looking forward to building this momentum further into 2021 as we maintain our mission of building the fast-casual brand of the future.” GDK has 73 restaurants in UK, Europe and Middle East, and is now rapidly expanding in the US, Canada, Saudi Arabia and Ireland.