Restaurant group Gaucho is considering the closure of popular chain Cau, which would lead to the loss of 700 jobs.
Gaucho is in talks with KPMG to discuss the possible options for the 22 casual dining steakhouses across the UK.
As part of a comprehensive strategic review, the group’s new management team, with the support of its shareholders, is at the early stages of exploring a number of financial restructuring options. No decisions have yet been made,” said a spokesperson for the group.
The chain has suffered from heavy competition and a squeeze on consumer spending, leading to a fall in sales.
According to Sky News, Gaucho is considering a company voluntary arrangement (CVA) that would require the approval of landlords and other creditors. A source at the chain said that this was just one of several options and a CVA was less likely.
2018 has seen a string of restaurant chains take up CVA. Chains include Byron, Jamie Oliver’s Jamie’s Italian restaurants and Prezzo.
The high street chains New Look and Carpetright (LON: CPR) have also closed stores using CVAs.
The founder of M Restaurants, who is the former Gaucho managing director Martin Williams, said: “I’m incredibly sad to hear that the fantastic team and some of the incredible talent which I nurtured in my nine-year tenure at Gaucho now have their jobs at risk.
“We will open our doors to the Gaucho and Cau staff and try to offer employment to all.
“Late last year we heard that the company was struggling and approached the owners with a solution which we thought would help the Cau and Gaucho chains whilst providing a great expansion platform for the M brand. Sadly this didn’t work out, but we will look again at the opportunities which arise in the coming weeks.”