Kout Food Group Restaurants (KFGR-UK), which owns the Maison Blanc brand and 40 Burger King and KFC locations, has bought Little Chef from RCapital for £15 million.
The exit by RCapital follows a six-year involvement with the motorway service station restaurant chain, which was recently the subject of a menu overhaul by celebrity chef Heston Blumenthal.
RCapital bought Little Chef in 2007 after the chain entered administration. Prior to that move, the chain had been through number of sale processes including a purchase by private equity firm Primera (alongside Travelodge) for £712 million in 2002 and sale to catering entrepreneurs Lawrence Wosskow and Simon Heath for £58 million in 2005.
Jamie Constable, CEO of RCapital, says that since the turnaround investor put Little Chef up for sale in April, many people have questioned the decision to exit.
‘The answer is very simple. We are specialists in reversing the fortunes of businesses with significant financial and operational problems,’ Constable explains.
‘We turn businesses around, we rebuild and fix them, that’s our business. Looking back, Little Chef was the biggest and longest turnaround in our nine-year history.’
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By purchasing Little Chef, KFGR-UK has made its first entry into the all-day breakfast and travel dining market, which is said to be worth £3 billion in Britain.
The food group was picked as a buyer, RCapital says, because of its commitment to grow the Little Chef business and brands.
Constable adds, ‘Having owned Little Chef for a long time it feels like we are selling part of ourselves. But we take comfort from the fact that the new owners will take the brand to the next stage.’
Little Chef now has 1100 staff and serves six million UK customers a year from its locations along A-roads.
Fadwa Al Homaizi, chairperson for KFGR-UK, adds, ‘KFGR-UK has exciting plans to revitalise the Little Chef brand. Little Chef will benefit from a process of brand renewal in keeping with current trends, supported by traditional British values.’