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Little Chef In Rescue Talks With American InvestorsIt is understood that The People’s Restaurant Group (PRG), which acquired the business little more than a year ago for £52 million, is being advised by KPMG’s corporate finance arm as it seeks fresh investment to stave off the threat of bankruptcy. The move comes less than a week after it emerged that PRG was in crisis talks with its landlord and other creditors over a cash crunch. Although the company owes little or no money to its bankers, Barclays, it is understood to be having trouble meeting rent liabilities. PRG’s problems stem from the £60.3 million sale and leaseback deal over 65 sites that it signed in February with Arazim Investment, the Israeli property investment firm. Although trading at Little Chef has improved, it has not done so as quickly as PRG had hoped. The problems have been exacerbated by the illness of Lawrence Wosskow, one of the entrepreneurs who backed the purchase of Little Chef from Permira, the private equity firm, in October 2005. He suffered a heart attack during the summer. A spokeswoman for PRG said last night: “We are in the middle of sensitive refinancing negotiations. We need new finance as Lawrence feels he no longer wants to be part of it.” The Times understands that PRG and KPMG have held talks with a consortium of American investors, including a big property group, over a rescue deal that would assure Little Chef’s future and provide it with funds to improve its estate of about 235 roadside eateries. There are suggestions that PricewaterhouseCoopers has been put on notice to act as administrator if the negotiations fail. However, a source close to the company said: “We are still very hopeful that this situation can be resolved.” Tag CloudExternal InformationAdditional InformationBank of Japan Leaves Key Rate Unchanged...Retailers braced for icy blasts a Easter falls at earliest since 1913... Blazing a Paper Trail in China... Russia Considers Alternatives to Oil Pipeline Through Belarus... Where Am I?News Main Page - Business - Little Chef In Rescue Talks With American Investors |
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