TGI Fridays will remain on UK high streets following a rescue deal for the chain, but more than 1,000 staff have lost their jobs with the immediate closure of 35 restaurants.
Breal Capital and Calveton UK have acquired 51 restaurants after the group’s previous operator fell into administration.
It means that nearly 2,400 jobs have been saved across the US-themed restaurant and cocktail bar.
But joint administrators at Teneo said 35 restaurants were not included in the sale and have been closed immediately, resulting in 1,012 redundancies.
We are devastated for our colleagues who will be leaving TGIs and thank them for their loyalty and contribution during their time with us
Julie McEwan, TGI Fridays’ chief executive
Julie McEwan, chief executive of TGI Fridays UK, said: “The news today marks the start of a positive future for our business following a very challenging period for the casual dining sector as a whole.
“We are devastated for our colleagues who will be leaving TGIs and thank them for their loyalty and contribution during their time with us.
“We are doing everything possible to retain our team and support those impacted.”
Daniel Smith, senior managing director of Teneo, said the acquisition “preserves a significant proportion of jobs and will hopefully provide the business with the stability and support it needs to recover and grow”.
New private equity owners Breal and Calveton jointly own upmarket restaurant chain D&D London, and between them have had investments in Byron Burger and wine bar chain Vinoteca.
The companies said they were “delighted” to be working with the management team to “both modernise the business and capitalise on the heritage of this iconic brand”.
Trade union Unite said on X, formerly Twitter, that it had been hearing from members who had been “furiously contacting” the hospitality organisers in response to the immediate closures.
It reported that staff had been shut out of restaurants, with padlocks on the doors changed, or given no form of redundancy consultation, while others were invited to a video call with members of the head office with one hour’s notice.
Other workers said they had not been told whether or not they will be paid, according to the trade union.
TGI Fridays’ previous UK operator, Hostmore, appointed administrators last month and had been hoping to secure a buyer for the chain of 87 restaurants.
Hostmore said it was not expecting to “recover any meaningful value” from the sale of sites, meaning it would earn less from the sale than what it owes to creditors and banks.
The companies did not disclose the value of the sale agreed with Breal and Calveton.
Keeping the essence of what made the business successful whilst finding a new direction won’t be an easy task
Danni Hewson, AJ Bell
TGI Fridays was first launched in New York in 1965, and continues to operate about 130 restaurants in the US.
The business grappled with weaker spending in the UK in recent years, and said it had been impacted by a post-Covid slowdown in demand across the casual dining sector.
Danni Hewson, head of financial analysis at AJ Bell, said TGI Fridays is a brand “wrapped in nostalgia but one the new owners are hyper aware needs to modernise to appeal to today’s diner”.
“Keeping the essence of what made the business successful whilst finding a new direction won’t be an easy task and the new owners have carved off 35 branches they don’t feel confident taking forward,” she said.
“The buyers, Breal Capital and Calveton UK, have a good track record in hospitality and with more than 2,000 jobs saved the brand has a chance to rediscover its mojo.”