Steak restaurant Gaucho '˜under threat' after just eight months
Jobs at Gaucho's flagship restaurant on St Andrew Square are under threat as the company looks set to fall into administration.
The steak restaurant chain appears destined to crash into administration after its lenders opted not to pursue a rescue deal.
About 1500 jobs are in jeopardy across the UK following the predicted collapse of the group.
And there is set to be job losses at the chain’s St Andrew Square, which opened amid great fanfare just eight months ago, as well as for staff at the chain’s CAU restaurant on Castle Street.
The company has filed a notice of intention to appoint Deloitte as its administrator.
It is understood that all of the rescue options have been rejected by the current syndicate behind the group.
Gaucho, which specialised in prime cuts of free-range beef, is set to become the latest casualty of a grim year for the high street, with stores such as Poundworld, Maplin and Toys R Us all collapsing.
In total, 16 Gaucho restaurants are at risk, but are seen as a “viable business” from the administration.
The loss-making CAU-branded chain is likely to close.
Cau, described by Equistone as an “aspirational casual dining chain”, had been launched in 2010.
Gaucho, which specialises in Argentinean steaks and fine wine, has 12 restaurants in London, with others in Edinburgh, Birmingham, Leeds, Manchester, Dubai and Hong Kong.
It was reported the chain owed a seven-figure tax bill to HM Revenue and Customs.
The firm’s advisors had been trying to find a buyer for the 39 restaurants in the Gaucho and Cau chains. However, high debt levels and a complex legal structure meant it had been unable to find an “agreed, solvent solution”, a spokesperson said.
In a statement, a Gaucho spokesman said: “Despite an extensive options process, which attracted proposals from a number of parties, it is with regret that due to the complexities of the group’s legal structure, ongoing underperformance at CAU and the level of indebtedness, the directors have been unable to find an agreed, solvent solution.
“Consequently, the directors have filed in court a Notice of Intention to Appoint an administrator for the business.
“Until such time as the administrator has been appointed and agreed plans with management, it is business as usual.”
Despite the assertions, calls made to the Gaucho and Cau restaurants in Edinburgh by the Evening News yesterday were not answered.
Gaucho’s marketing director Matt Ford had said of Edinburgh’s high-spec Gaucho restaurant ahead of its launch: “We want it to be aspirational, but also accessible.”
Gaucho recently appointed a new management team in an attempt to stabilise its financial performance, although it had limited experience of the restaurant sector. Prezzo, Jamie’s Italian, Byron and Carluccio’s are among restaurant chains to announce plans to close outlets, including those in the Capital, this year amid a hospitality sector squeeze.