Little Chef sold to Kuwait firm in £15m deal
ROADSIDE restaurant chain Little Chef, which had its headquarters in Sheffield until last year, has been sold to a Kuwait-based firm in a deal worth £15m.
Kout Food Group Restaurants UK Limited (KFGR-UK) has bought the business from private equity house Rcapital.
KFGR-UK is wholly owned by Kout Food Group k.s.c.c., a company listed on the Kuwaiti Stock Exchange, and a member of the Al Homaizi Group.
KFGR-UK also owns the iconic Maison Blanc brand, in addition to more than 40 Burger King and KFC units as well as Cha Cha Moon.
Rcapital took the decision to explore options for the roadside restaurant business in April and appointed a corporate finance firm to manage the process.
It is thought bidders for the business included McDonald’s, KFC and Costa, who reportedly had the intention of taking on the sites but losing the Little Chef name.
However, Rcapital said the aim was to find a buyer that would take the business and its operating brands on to “the next stage.”
The troubled restaurant chain fell into administration in 2007 before being saved by RCapital.
The turnaround group bought the majority of the business and assets – saving 193 of the 235 restaurants, and more than 3,500 jobs.
Over the last six years, Rcapital has successfully completed an operational turnaround which has repositioned the business and brought the group of companies back into profitability.
Jamie Constable, chief executive of Rcapital, said: “Since we put Little Chef up for sale people have asked us, why sell the business? The answer is very simple. We are specialists in reversing the fortunes of businesses with significant financial and operational problems. We turn businesses around, we rebuild and fix them, that’s our business. Looking back, Little Chef was the biggest and longest turnaround in our nine year history.
“When we bought the chain, it needed huge changes to revive the business and bring it back to profitability. It was much harder than we expected. As the country faced one of the worst economic declines in living memory, we rolled up our sleeves and got on with it, we believed we could make it work and we did.
“Having owned Little Chef for a long time it feels like we are selling part of ourselves. But we take comfort from the fact that the new owners will take the brand to the next stage.”
Little Chef employs 1100 staff and serves more than six million customers a year.
Michelin-starred chef Heston Blumenthal was hired in 2008 to try to revive the business but so far his menu is available in only a handful of Little Chef restaurants.
