The owner of the Bella Italia, Café Rouge and Las Iguanas restaurant chains has collapsed into administration, with the immediate loss of 1,900 jobs.
The Casual Dining Group has appointed the advisory firm AlixPartners to handle the administration, which is expected to result in the breakup of the group and the streamlined chains sold off to new investors. The company said multiple offers were on the table but buyers did not want to acquire all the existing sites and 91 of its 250 outlets would remain permanently closed.
“We appreciate that this is an extremely difficult time for all those associated with Casual Dining Group,” said Clare Kennedy, one of the administrators. “Our immediate priorities are to assist those whose employment has been affected by today’s announcement and to secure a sale for the group in order to protect jobs and provide the group’s much-loved brands with a sustainable platform for the future.”
The coronavirus lockdown has prompted some of the UK’s most prominent companies to announce large-scale job losses. The aviation, automotive and retail sectors have been among the worst hit, as businesses adjust to dramatically reduced revenue projections.
While the government’s job retention scheme has so far protected millions of jobs, fears are mounting that unemployment will rise as the scheme begins to be phased out from August.
Since lockdown began on 23 March, some of the UK’s largest companies have announced plans to cut a total of 60,000 jobs globally, many of which will fall in the UK.
Rolls-Royce - 9,000 jobs
The jet-engine manufacturer has confirmed that 3,000 job cuts, of a planned 9,000 worldwide, will be made in the UK. In May Rolls-Royce said it would make the first round of redundancies through a voluntary programme, with about 1,500 posts being lost at its headquarters in Derby, as well as 700 redundancies in Inchinnan, near Glasgow, another 200 at its Barnoldswick site in Lancashire, and 175 in Solihull, Warwickshire.
BP- 10,000 jobs
The oil company said in June it plans to make 10,000 people redundant worldwide, including an estimated 2,000 in the UK, by the end of the year. The BP chief executive, Bernard Looney, said that the majority of people affected would be those in office-based jobs, including at the most senior levels. BP said it would reduce the number of group leaders by a third, and protect the “frontline” of the company, in its operations.
Centrica- 5,000 jobs
The owner of British Gas announced in June that it intends to cut 5,000 jobs, mostly senior roles, and remove three layers of management, in a bid to simplify the structure of its business. The energy firm has a total workforce of 27,000, of whom 20,000 are in the UK.
Bentley- 1,000 jobs
The luxury carmaker intends to shrink its workforce by almost a quarter, slashing 1,000 roles through a voluntary redundancy scheme. The majority of Bentley’s 4,200 workers are based in Crewe in Cheshire.
Aston Martin Lagonda – 500 jobs
The Warwickshire-based luxury car manufacturer has announced 500 redundancies.
British Airways - 12,000 jobs
The UK flag carrier is holding consultations to make up to 12,000 of its staff redundant, a reduction of one in four jobs at the airline. BA intends to cut roles among its cabin crew, pilots and ground staff, while significantly reducing its operations at Gatwick airport.
Virgin Atlantic - 3,000-plus jobs
Richard Branson’s airline is to cut more than 3,000 jobs, more than a third of its workforce, and will shut its operations at Gatwick.
EasyJet – 4,500 jobs
The airline has announced plans to cut 4,500 employees, or 30% of its workforce.
Ryanair – 3,000 jobs
The Irish airline intends to slash 3,000 roles and reduce staff pay by up to a fifth.
Aer Lingus – 900 jobs
The Irish airline, part of International Airlines Group (IAG) plans to cut 900 jobs.
P&O Ferries – 1,100 jobs
The shipping firm intends to cut more than a quarter of its workforce, a loss of 1,100 jobs. The company, which operates passenger ferries between Dover and Calais, and across the Irish Sea, as well as Hull to Rotterdam and Zeebrugge, will initially offer employees voluntary redundancy.
JCB – 950 jobs
Digger maker JCB said in May up to 950 jobs are at risk after demand for its machines halved due to the coronavirus shutdown.
Ovo Energy – 2,600 jobs
Britain’s second biggest energy supplier announced in May it planned to cut 2,600 jobs and close offices after the lockdown saw more of its customer service move online.
Johnson Matthey – 2,500 jobs
The chemicals company said in June it is planning to make 2,500 redundancies worldwide over the next three years. The move will affect 17% of the workforce at the firm, which is a major supplier of material for catalytic converters.
Bombardier – 600 jobs
The Canadian plane maker will cut 600 jobs in Northern Ireland, as part of 2,500 redundancies announced in June.
The Restaurant Group – 1,500 jobs
The owner of Tex-Mex dining chain Chiquito, and other brands including Wagamama and Frankie & Benny’s, said in March that most branches of Chiquito and all 11 of its Food & Fuel pubs would not reopen after the lockdown, leading to the loss of 1,500 jobs.
Monsoon Accessorize – 345 jobs
The fashion brands were bought out of administration by their founder, Peter Simon, in June, in a deal which saw 35 stores close permanently and led to the loss of 545 jobs.
Clarks – 900 jobs
Clarks plans to cut 900 office jobs worldwide as part of a wider turnaround strategy
Oasis and Warehouse – 1,800 jobs
The fashion brands were bought out of administration by restructuring firm Hilco in April, in a deal which led to the permanently closure of all of their stores and the loss of more than 1,800 jobs.
Debenhams – 4,000 jobs
At least 4,000 jobs will be lost at Debenhams as a result of restructuring, following its collapse into administration in April, for the second time in a year.
Mulberry – 470 jobs
The luxury fashion and accessories brand said in June it is to cut 25% of its global workforce and has started a consultation with the 470 staff at risk.
Jaguar Land Rover – 1,100 jobs
The car firm is to cut 1,100 contract workers at manufacturing plants the UK, potentially affecting factories at Halewood on Merseyside and Solihull and Castle Bromwich in the West Midlands.
Travis Perkins – 2,500 jobs
The builders’ merchant is cutting 2,500 jobs in the UK, accounting for almost a 10th of its 30,000-strong workforce. The company, which is behind DIY retailer Wickes and Toolstation, said the job losses will affect staff in areas including distribution, administrative roles and sales. The move will also affect staff across 165 stores that are now earmarked for closure.
Swissport – 4,500 jobs
Swissport, which handles services such as passenger baggage and cargo for airlines has began a consultation process that is expected to result in 4,556 workers being made redundant, more than half of its 8,500 UK workforce.
Royal Mail - 2,000 jobs
Royal Mail has announced a cost-cutting plan that will involve slashing about 2,000 jobs. One in five of its near-10,000 management roles will go by March 2021, in areas including IT, finance, marketing and sales. The company’s 90,000 postal workers would not be affected by the cuts.
SSP Group – 5,000 jobs
The owner of Upper Crust and Caffè Ritazza is to axe 5,000 jobs, which represents about half of its workforce. The cuts will have an impact on staff at its head office and across its UK operations. It follows a dramatic fall in domestic and international travel, which has hit the company’s sites based at railway stations and airports.
Accenture – 900 jobs
The consultancy firm is reduces costs in the face of lower demand for its services. The New York-listed company employs 11,000 people in offices across the UK including in Aberdeen, London and Cambridge. The UK job cuts will be at all levels, including managing directors, and across all parts of the business.
Harrods – 700 jobs
The department store group is cutting one in seven of its 4,800 employees due to the “ongoing impacts” of the pandemic. The Harrods chief executive, Michael Ward, blamed the cuts on social distancing and a lack of tourists.
Airbus – 1,700 jobs
The European planemaker announced plans this week to cut 1,700 jobs in the UK as it warned the coronavirus pandemic had triggered the “gravest crisis” in its history.
All the group’s restaurant brands are affected by the closures but Bella Italia and Café Rouge are bearing the brunt, with 35 and 32 closures respectively. Las Iguanas is shedding 11 sites while CDG’s beer, chips and mussels brand Belgo will permanently close three out of four outlets. The group’s airport brands Huxleys and Oriel are also going. In total, CDG employs just under 6,000 people.
The private equity-owned CDG had warned in May that administration was on the cards as the lockdown forced the temporary closure of all its sites. It is yet more bad news in a grim week for the retail and hospitality industries, which are shedding thousands of jobs despite the easing of lockdown restrictions that will allow restaurants and pubs in England to open their doors on Saturday for the first time in more than three months.
More than 6,000 retail job losses were announced on Wednesday alone. SSP, the owner of Upper Crust and Caffè Ritazza, said it was cutting 5,000 jobs as its sites in usually busy railway stations struggled for business as office workers continued to work from home. The CDG closures include a dozen restaurants in airports, including four outlets at Heathrow.
The pandemic has exacerbated problems that already existed in these sectors. Casual dining chains have been going through restructurings for several years after a private equity-backed boom ended in an oversaturated market.
Julie Palmer, a partner at the corporate restructuring firm Begbies Traynor, said: “The casual dining sector was in distress before this crisis but this is what will tip many over the edge and towards collapse. The make up of the high street before this crisis was such that one could not do without the other and they begin to spiral down together towards the bottom of their finances.”
At the start of this week the private equity backers of the burger chain Byron said they were preparing to place the company into administration. The accountancy firm KPMG has been trying to sell Byron since early May but has attracted no bids for the 51-restaurant chain.
In June the Restaurant Group, which owns Frankie & Benny’s and Garfunkel’s, said it would close up to 120 restaurants, with almost 3,000 jobs losses, while more than 1,000 Carluccio’s staff lost their jobs as part of a rescue deal in May.
On Thursday it also emerged that Market Halls, the company which operates three of the biggest food halls in the UK, would not reopen its three London sites, resulting in 86 redundancies.
Two years ago CDG closed 50 underperforming restaurants, renegotiated rents with its landlords and received a £30m injection from its private equity investors – KKR, Pemberton and Apollo. But it was not enough to turn around the loss-making business which, in common with its casual dining rivals, had been hit by rising costs and slowing consumer confidence.
A number of potential investors have been linked to the CDG brands including the German investment group Aurelius – which is said to be interested in buying the Café Rouge and Bella Italia chains – while Endless and TriSpan, the backer of Thunderbird Fried Chicken, are said to be vying for Las Iguanas.
