The troubled burger chain Byron is to close up to 20 restaurants, nearly a third of its outlets, after a rescue plan was agreed.
The restructuring, known as a company voluntary arrangement (CVA), was agreed on Wednesday by the group’s creditors and also involves reducing rents by a third at five sites. Rent will be cut by 55% at 20 sites for six months while Byron negotiates their future, but most of them are expected to close.
Byron runs 67 restaurants and employs about 1,800 people across the UK but wants to focus on a smaller number of profitable restaurants.
Simon Cope, chief executive of Byron, said the company would do everything possible to redeploy staff from the affected restaurants.
“With the support of our new owners, Three Hills Capital, I’m confident that a new Byron can begin to take shape. Byron’s brand and offer remains strong and distinctive, and with a smaller and more efficient restaurant estate we can continue to provide an outstanding burger experience for our customers and to develop and grow a sustainable and innovative business for the long term.”
The chain has suffered amid a squeeze on casual dining chains from soaring labour costs, business rates, rent and food inflation.
Jamie’s Italian recently proposed the closure of about a third of its 35 restaurants via a CVA in addition to the six sites it closed early last year.
Will Wright, restructuring partner at KPMG and joint supervisor of the Byron CVA, said: “Today’s creditor vote in favour of the CVA proposal will allow Byron to conclude its previously negotiated financial restructuring and is a key step in the directors’ turnaround plan.
“As with all CVAs, more than 75% of creditors had to vote in favour in order to pass the resolution. Today’s vote saw us secure significantly more than this majority with 99% of all voting creditors choosing to approve the CVA.”
Under the terms of the deal, the existing investor Three Hills Capital Partners will become the majority shareholder. The current owner, Hutton Collins, will retain a minority stake in the business.