After months of speculation about the future of Press Up Hospitality, the 935 staff at the chain finally got some clarity on the way forward for the restaurant, bar and nightclub business.
In a debt-for-equity restructuring, Cheyne Capital, a London-based finance house that was owed €45 million by Press Up, has taken control of the business with co-founder Paddy McKillen jnr holding a small stake of less than 10 per cent. Cheyne is injecting some €20 million in fresh capital into the group.
For 18 venues it’s a case of business as usual. Four entities that operate another 12 have been placed into receivership, with KPMG’s Shane McCarthy and Cormac O’Connor filling those roles, and the Wowburger on Parnell Street has been shuttered.
Those in receivership operate under the Elephant & Castle, Wowburger and Wagamama brand and have serious balance-sheet issues. It would not have been viable to continue trading them, hence the receivership process.
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The receivers will be seeking to renegotiate legacy debt on these businesses and talks with landlords and suppliers have been flagged. Some or all of these venues are potentially under threat unless they can be put on a sound financial footing.
A budget-day reduction in the VAT rate back to 9 per cent for food service businesses would clearly be helpful in bolstering Press Up’s bottom line but there is no evidence that Minister for Finance Jack Chambers is minded to go that route.
In the meantime, Cheyne and the receivers need to whip the business into shape and hone its offering to get it to a point where it might be possible to put it on the blocks or attract external investment.
One thing seems certain: Cheyne does not want to be the long-term owner of Press Up.
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