| UK

£200m sale of Gail’s Bakery reportedly delayed until after Brexit

Sale of 40-strong UK bakery and coffee chain business, reported to be worth £200m, will be postponed until after the UK is scheduled to leave the EU in March 2019

Plans to sell the Gail’s Bakery chain have been delayed by Brexit according to a report by the Press Association. Businessman Luke Johnson, who backed a management buyout of the 40-store bakery and coffee chain in 2011 through investment firm Risk Capital Partners (RCP), reportedly enlisted advisors KPMG in 2017 to explore sales options on behalf of Gail’s parent company, Bread Holdings.

The auction process was understood to have been scheduled for late 2018, but the plans have now reportedly been shelved until the UK is scheduled to leave the European Union in March 2019. The mainly London-based chain could be worth up to £200m according to some estimates.

A weaker pound since the 2016 EU referendum has piled pressure on many of the UK’s food-to-go and restaurant chains as they grapple with higher food prices. Jamie’s Italian, Byron and Prezzo have all faced store closures during the last 12 months.

The delayed sale of Gail’s comes just days after Johnson authorised a £20m bailout to save Paterissie Valerie's 206 cafés after the coffee and bakery chain was rocked by an accounting scandal. Paterissie Valerie is the UK’s third-largest food-focussed operator and reported pre-tax profits growth of 14.2% in the six months to March 31, 2018 to £11.1m.
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