The axe has fallen on the Cau restaurant chain after the Gaucho restaurant group appointed accountancy firm Deloitte as administrator for the business.
All 22 branches of Cau have now ceased trading following the decision, affecting some 540 jobs. On its website Cau directs customers customers to Deloitte’s website for information on the administration.
The administrators hope that by shutting Cau, it will be easier to find a buyer for the Gaucho business.
Cau has been described as “significantly loss-making” following three years of revenue decline and “ongoing underperformance” whereas the Gaucho brand remains profitable.
Joint administrator Matt Smith said in a statement: “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.
“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.”
It is understood that there are 17 Gaucho restaurants, employing around 750 people including head office staff.