Restaurants in Guildford, Walton and Staines could close after Gourmet Burger Kitchen announced plans to shut 17 of its 80 branches.
The group, owned by South Africa-based Famous Brands, has announced plans for a company voluntary arrangement (CVA), an insolvency procedure which allows struggling firms to dump unprofitable stores.
Around 250 jobs across the country could be affected, although it is not yet known if the three branches in Surrey will be among those facing closure.
GBK’s owners said on Wednesday (October 24) it would initiate the CVA process with advice from consultants Grant Thornton, and creditors will vote on the closures on November 9. All restaurants will continue trading in the meantime.
The announcement that GBK is considering a CVA comes after its owners said they faced a £47.2 million pre-tax impairment charge due to the brand’s sustained underperformance.
It is a stark contrast from Famous Brands’ initial plan for the restaurant chain. On taking over GBK in 2016, the company said it would double the business’s size, create more than 2,500 jobs and look to export the brand to South Africa.
GBK’s managing director Derrian Nadauld said: “Given the challenging UK casual dining environment and over-rented UK restaurant estate, we are having to take tough but necessary actions to reduce our fixed cost base and restore long-term profitability.”
Store closures at GBK would represent the latest in a long line of casual dining firms to shut restaurants this year.
Cau, Byron, Prezzo and Jamie’s Italian have all fallen on hard times as costs have rocketed off the back of the Brexit-hit pound, while consumer confidence has nosedived as the economy falters.
This content was originally published here.