Private Equity Giant Apollo Acquires The Restaurant Group (TRG)
The Restaurant Group (TRG), the owner of popular family favourite restaurant chains, has been sold in a major deal. Private equity firm Apollo will acquire TRG for £701 million, marking a 34% premium on the firm's share price. The deal includes brands such as Wagamama, Barburrito, Brunning & Price, Coast to Coast, Firejacks, and Est Italian.
Focus on Other Brands
TRG recently sold Frankie & Bennys and Chiquito to The Big Table group, the owner of Cafe Rouge and Bella Italia. This move allows TRG to concentrate on its remaining brands, particularly Wagamama, which has been performing well.
Closures and Impact of the Pandemic
TRG announced plans to close around 40 sites by April 2024, reducing its leisure estate from 116 sites to between 75 to 85. The decision was made due to widening losses and the impact of the cost of living crisis on its restaurant chains. The closures have already taken place, including Frankie & Bennys, Chiquito, and Firejacks locations.
The coronavirus pandemic also forced TRG to close hundreds of its restaurants. In 2020 alone, 61 Chiquito restaurants were closed, resulting in the loss of approximately 1,500 jobs. Additionally, 125 other restaurants, including several Frankie & Benny's locations, were shut down. TRG also closed its Food and Fuel chain of pubs in London.
Tough Times for the Hospitality Sector
The hospitality sector has been struggling to recover from the impact of the pandemic. Rising energy bills and inflation have added to the challenges faced by food and drink chains. This has led to fewer people dining out, resulting in the closure of branches for various chains, including Wetherspoons, Byron Burger, and Prezzo.
Despite the difficulties, TRG remains optimistic about its future. The company has reported strong trading in its pubs, concessions, and Wagamama chain. It plans to open between eight to 10 new Wagamama restaurants annually starting from next year.
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