Businesses appoint administrators as virus closures hit high streets

Image: Alena Veasey / Shutterstock.com

The coronavirus outbreak is continuing to take its toll on the UK’s high streets and put thousands of jobs at risk, with Carluccio’s and BrightHouse appointing administrators and Tex-Mex restaurant Chiquito preparing to do the same.

Italian restaurant chain Carluccio’s blamed the coronavirus for exacerbating the already “challenging trading conditions” it had been experiencing.

It would continue to pay its 2,000 staff through the government’s Coronavirus Job Retention Scheme, or “furlough” scheme, while it explored its options. Administrator FRP, which was appointed yesterday, is considering whether the company can continue to trade using government funding, or whether it can sell all or part of the business.

Joint administrator Geoff Rowley said: “We are operating in unprecedented times and the issues currently facing the hospitality sector following the onset of Covid-19 are well documented.

“In the absence of being able to continue to trade Carluccio’s, in the short term, we are urgently focused on the options available to preserve the future of the business and protect its employees.”

The Carluccio’s announcement came just minutes after rent-to-own household goods firm BrightHouse said it had appointed an administrator.

The company had been struggling after it was ordered to pay customers £14.8m in compensation by the Financial Conduct Authority in 2017. The FCA found it had sold products using lending agreements that “may not have been affordable” and did not refund customers after they cancelled their agreements after one payment.

Its shops had also been shut because of the coronavirus restrictions on retailers. Julie Palmer, a regional managing partner at corporate recovery firm Begbies Traynor, said the virus had been “the final nail in the coffin for BrightHouse”.

The firm, which trades as BrightHouse but is registered as Caversham Finance, employs around 2,400 people and has 240 shops.

Administrators at Grant Thornton were appointed yesterday (30 March). It is still trading, with employees either working remotely or working in ways that it can “provide for employee and customer safety”.

Over the weekend, The Restaurant Group, which owns brands including Wagamama and Frankie & Benny’s, filed a notice to put its Tex-Mex dining chain Chiquito and London-based gastro pub chain Food & Fuel into administration.

It said Covid-19 had had an “immediate and significant impact” on the group, which had prompted a review of its business.

A statement on Chiquito’s website reads: “We are absolutely heartbroken to announce that all our restaurants will be closing tonight until further notice – including those offering home delivery.”

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