An Argentinian restaurant which opened on Water Lane in March 2015 will be closing imminently.
Deloitte have today been appointed as joint administrators to both Gaucho and CAU restaurant chains.
The group, which operates 16 Gaucho restaurants and 22 branches of CAU, has suffered as a result of the material underperformance of the CAU brand, which has suffered from negative like-for-like sales for three years, and is as a consequence now significantly loss-making.
As such, the administrators' strategy involves an immediate closure of all the UK CAU restaurants, resulting in approximately 540 redundancies, and a focus on maximising the value achievable in the Gaucho business, which is profitable. All of the Gaucho sites will continue to trade 'as usual' whilst the administrators seek a buyer for the business. They will also seek to find potential buyers for the CAU sites.
Matt Smith, joint administrator, commented "Unfortunately the CAU brand has struggled in the oversupplied casual dining sector with rapid over-expansion, poor site selection, onerous lease arrangements and a fundamentally poor guest proposition all being factors in its underperformance. As such, the decision has been made to close this loss-making part of the group with immediate effect, unfortunately resulting in today's redundancies.
"The Gaucho business on the other hand, which operates in the premium dining market, continues to trade well in its market segment, is profitable and has a strong underlying brand and guest loyalty. We are taking steps to stabilise the business following our appointment and are now seeking expressions of interest in terms of a sale of the Gaucho business."