Auditors KPMG will this morning begin the task of trying to find a buyer for Patisserie Valerie after the stricken cafe chain went into administration yesterday evening.
Around 70 of the chain’s 200 stores are set to close immediately, with up to 900 jobs reported to be at risk.
The company had spent recent days attempting to get its bank facilities renewed following the financial crisis that has engulfed the company since it discovered a £20m black hole in its books back in October.
But after those talks failed to reach the conclusion it wanted, the company was forced to call in administers after conceding that it does not have sufficient funding to meet its liabilities as they fall due.
Chairman Luke Johnson, the biggest shareholder in Patisserie Valerie, has personally extended an unsecured, interest-free loan of £3m to help ensure that the January wages are paid to all staff working in the business.
This loan will also assist the administrators in trading as many profitable stores as possible while a sale process is undertaken.
Last week the owners of Patisserie Valerie admitted for the first time that the multi-million pound fraud it uncovered last year was worse than it first thought.
Work carried out by the company’s forensic accountants has revealed that the misstatement of its accounts was “extensive”, involving “very significant” manipulation of the balance sheet and profit and loss accounts.
“Among other manipulations, this involved thousands of false entries into the company’s ledgers. It will take some time before a reliable trading outlook can be completed while the above work streams progress,” the company stated.