Gourmet Burger Kitchen to close restaurants and cut 326 jobs despite rescue deal

Casual dining chain says 35 sites will remain open, with 669 jobs saved

Gourmet Burger Kitchen has been sold in a pre-pack administration process (GBK)

Gourmet Burger Kitchen is to cut 362 jobs despite being bought in a rescue deal byb Boparan Restaurant Group.

GBK said it would close 26 stores after a pre-pack administration process. A further 35 sites and 669 jobs will be saved, the company said on Wednesday.

The chain has been bought in a rescue deal by British poultry tycoon Ranjit Boparan, who has been known as the "Chicken King".

Mr Boparan's company owns chains including Ed's Diner and Giraffe, as well as Birmingham-based meat processing firm 2 Sisters group, the UK's largest food company by turnover.

He also bought Carluccio's after it went into insolvency early in the pandemic.

GBK said it had started to see improvements in trading last year after a major restructuring process in 2018, which saw it shut a raft of sites.

However, the company, which had been owned by South African group Famous Brands, said it slid into administration after the virus impacted upon its liquidity and potential to be sold as a solvent business.

The deal comes after a string of administrations, closures and sales of casual dining restaurants. Wagamama, Cafe Rouge and Burger King are among the well-known high street names to look at restructuring as the pandemic worsened an already difficult outlook.

Gavin Maher, joint administrator at Deloitte, said: "As with a number of dining businesses, the broader challenges facing 'bricks and mortar' operators, combined with the effect of the lockdown, resulted in a deterioration in financial performance and a material funding requirement.

"We have been working closely with the management team under very difficult market conditions to try and find a funding solution and I am glad to be able to announce the rescue of this well-loved brand together with a large proportion of the sites and workforce.

"However, it's clearly disappointing that a number of sites have had to close resulting in today's redundancies.

"We would like to thank all of those involved in the transaction, including our legal advisers, DLA Piper, and wish the management team, workforce and the new owners, Boparan Restaurant Group, every success in now taking the business forward."