Burger chain faces fight for survival as restaurant sector pain grows
Byron has become the latest burger restaurant to feel the chill of changing tastes, forcing it to plan a restructure that threatens three West Midlands sites.
Byron has outlined its plans for a company voluntary arrangement (CVA) and is seeking approval from landlords for significant rent reductions.
Its Birmingham restaurant, which opened in October 2016, could close while its long-planned sites at Bell Court in Stratford-upon-Avon and Worcester’s Cathedral Square are now unlikely to open.
Byron’s struggles follows the administration last year of Birmingham-based Handmade Burger Company and of Ed’s Easy Diner, which was bought by 2 Sisters owner Ranjit Boparan.
Will Wright, restructuring partner at KPMG and the proposed supervisor of the CVA, said: “Over the last ten years, Byron has grown to become a stand-out name within the UK’s casual dining sector.
“However, in recent times, certain parts of its portfolio have not met expectations, and with gathering economic headwinds starting to impact the sector more profoundly, the directors embarked upon a strategic review of the business as a means of safeguarding its long-term future.”
Byron’s restaurants are heavily weighted towards London, where it has more than 40.
The CVA divides the chain’s portfolio into three categories. A total of 51 Category 1 sites, would see leases retained at current rents. A further five Category 2 leases have been identified as being viable with a rent reduction of around one-third.
The remaining 20 Category 3 sites, which include all three West Midlands sites, a reduced rent, equivalent to 55%, will be paid for six months, while the company engages with landlords to agree the basis of any continued trading from these premises.
Wright added: “As part of this strategic review, the directors have been successful in negotiating a financial restructuring with the company’s lenders and shareholders, which will enable new investment to come into the business.
“Completion of this financial restructuring is conditional on the approval of today’s CVA proposal.”
