D&D owners look to take over TGI Fridays UK franchise

Calveton and Breal Capital, which became the owners of restaurant group D&D London last year, are in “advanced negotiations” to buy TGI Fridays UK operations, according to Sky News.

TGI’s parent company Hostmore appointed administrators last week and delisted its ordinary shares after struggling to find a “lasting solution” to save the business.

Sky News reported that Calveton and Breal Capital are looking to take on TGI Fridays’ British franchise, involving the majority of its 89 sites. However, a significant number of jobs would still likely be lost, with analysts pointing to only 50-60 outlets being commercially viable.

The investors acquired D&D last October for £60m. The business operates around 40 restaurants in the UK and overseas, including Bluebird in London, 20 Stories in Manchester and Orelle in Birmingham, as well as the South Place hotel in London

Calveton bought the beleaguered Byron burger chain in 2020, while Breal Capital went on a hospitality acquisition spree this year and took over wine bar chain Vinoteca, Yorkshire’s Black Sheep Brewery and London craft brewers Brick Brewery and Brew By Numbers.

Meanwhile, Hostmore’s plans to buy its US parent company fell through earlier this month.

It said in April it had agreed to buy TGI Fridays for £177m but the deal broke down after the American company lost control of TGIF Funding, which controls the royalties from its lucrative franchise agreements and intellectual property.

The surprise announcement saw Hostmore’s share price plunge more than 90% from the start of the month to open at 0.2p.

It marks a stark drop from when the company was spun out of private equity trust Electra in November 2021 and started trading at 147p a share.

When Hostmore filed for administration, a statement issued on behalf of chief financial officer Matthew Bibby said: “Unfortunately, all of the board’s efforts to implement a lasting solution to support the long-term financial future of the business came against a highly challenging trading and macroeconomic backdrop, and efforts to create value for shareholders through the proposed acquisition of TGI Fridays, while well-advanced, encountered adverse events outside of the board’s control.”

Its trading subsidiary, Thursdays (UK) Limited, continues to operate as normal and all existing stores remain open.

However, according to Sky News, the operating business is itself understood to have filed a notice of intention to appoint administrators on Monday.

The UK’s first TGI Fridays opened in Birmingham’s Hagley Road in 1986.

The Caterer has approached D&D for comment.

Image: Billy F Blume Jr/Shutterstock