Little Chef Chain Up For Sale

Posted on 21 April, 2013 by MOVEHUT

The Little Chef chain has been put up for sale, with potential buyers including Costa Coffee and Starbucks.

The sale of the roadside restaurant group is expected to raise tens of millions of pounds for turnaround firm R Capital, which took control of the chain of eateries in 2007.

Service station operators such as Moto and Welcome Break are also expected to express an interest in buying the group.

The chain, which is famous for its Fat Charlie logo and its Olympic Breakfast, had around 200 restaurants when it was rescued by R Capital.

A major restructuring plan has focused the business on a core estate of 78 profitable restaurants beside A-roads all over Britain and a relaunched express takeaway service.

In an announcement, RCapital said: “Over the last six years, RCapital has successfully completed an operational turnaround and financial restructuring, which has repositioned the business and brought the group of companies back into profitability.

“The move was part of a long-term critical rebuild strategy to create consistently profitable sites against the backdrop of one of the worst recessions in living memory.

“With the turnaround successfully completed, it’s time to explore the next phase for the food service operator.”

Its first branch opened in Reading in 1958 with just 11 seats, and by the 1980’s the chain was serving millions of customers a year from more than 230 branches. However the chain’s popularity died out as motorway service stations added cheap fast food outlets such as KFC and McDonald’s.

The business racked up substantial losses under the ownership of The People’s Restaurant Group, which bought the chain of eateries from private equity group Permira for £52 million in 2005.

In 2009, Heston Blumenthal was brought in to revamp the eatery’s old-fashioned menu and décor. While a Channel 4 documentary about the celebrity chef’s conflicts with the Little Chef bosses generated some interest in the group, it couldn’t ultimately avoid restaurant closures and job losses.




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