Hostmore, the UK-based operator of restaurant chain TGI Fridays, has announced it will file for administration as it faces significant debt challenges.
The company’s subsidiary, Thursdays, which runs the restaurant chain, will continue to operate as usual, with all stores remaining open.
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Hostmore, which made its debut on the London Stock Exchange in 2021, has revealed that trading of its ordinary shares will be suspended from 18 September 2024.
The latest announcement comes amidst Hostmore’s ongoing struggles with its loss-making TGI Fridays outlets, which have led to a halt in new store openings, management restructuring, the sale of outlets and extensive cost reduction measures.
The company’s efforts to stabilise its finances include the ongoing sale of its corporate stores, to be completed by the end of September 2024.
The board of Hostmore has appointed Daniel Smith and Julian Heathcote from Teneo Financial Advisory as joint administrators of the company.
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By GlobalDataThe decision follows the company’s withdrawal from plans to acquire the US operator of TGI Fridays and its subsequent expectation to be wound up and de-listed after the retail outlet sale is finalised.
On 6 August, Hostmore initially confirmed its intention to sell TGI Fridays’ 92 corporate stores along with the group’s 87 corporate stores to either existing or new franchisees.
On 9 September, Hostmore indicated that the sales process was nearing completion but also acknowledged that it was unlikely to “recover any meaningful value” from its assets.
The BBC reported the company’s admission that the bids received are less than its outstanding debts, which implies that Hostmore may incur losses upon the completion of the sale.
Hostmore’s attempted acquisition of the US operator of TGI Fridays for £177m ($234m) ultimately fell through, adding to the company’s financial difficulties.
The latest move will impact 4,500 jobs.
