Administrators are reportedly finalising a rescue deal for the UK arm of the TGI Fridays restaurant chain in a move that could save more than 2,000 jobs.
Calveton and Breal Capital – the private equity owners behind upmarket restaurants including Le Pont de la Tour, Quaglino’s and Coq d’Argent – are said to be on the brink of buying up to 55 of the chain’s 87 UK restaurants, which could secure employment for almost half of the company’s 4,500 employees.
The potential deal is likely to include existing leases and the right to use the TGI Fridays brand in the UK, according to Sky News, which said a deal could be agreed as early as Monday.
It would add to a growing portfolio of food outlets for Calveton and Breal Capital. However, it would be a departure from the 40 upmarket restaurants they own through the D&D London brand that they bought last year, which includes German Gymnasium, Alcazar and Bluebird Chelsea.
The news comes less than a month after the TGI Fridays parent company, Hostmore, appointed the advisory firm Teneo as administrators after failing to turn around the chain’s fortunes.
Hostmore said in September that it aimed to secure a sale by the end of October. However, it warned that any deal would probably generate less than its debts, which stood at £35m.
Its restaurants have continued to operate as normal as administrators rush to secure a deal.
Founded in 1965 in New York by a group of friends, TGI Fridays – Thank God It’s Friday – aimed to combine classic American dishes such as burgers with a casual lively atmosphere. It launched in the UK in 1994 and built up a large chain that was taken over by the private equity group Electra Partners in 2014. Electra spun out the owner of TGI – Hostmore – in 2021, listing it in London.
Hostmore’s board said last month that they had “inherited a very challenging set of circumstances” and that cutting annual spending by £12m, reducing losses from unprofitable stores, and improving customer experience had not been enough to save the business.
“Unfortunately, all of the board’s efforts to implement a lasting solution to support the long-term financial future of the business came against a highly challenging trading and macroeconomic backdrop, and efforts to create value for shareholders through the proposed acquisition of TGI Fridays, while well-advanced, encountered adverse events outside the board’s control,” Hostmore said in September.
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Hostmore’s shares have since been suspended from trading.
Teneo declined to comment. Calveton and Breal Capital could not be immediately reached for comment.