Cafe Rouge and Bella Italia Owner to Close Over 1/3rd of Outlets

The Casual Dining Group, which owns the likes of Bella Italia, Las Iguanas and Café Rouge, has entered administration, with nearly 2,000 jobs set to be axed.

Administrators have been called and it is expected that 91 of 250 outlets will close.

While most of the expected closures will affect the Cafe Rouge and Bella Italia chains, 11 Las Iguanas outlets, three Belgo restaurants and several sites at airports are also expected to close.

Chief executive James Spragg said: "After reviewing all our options with advisors, it became clear that we needed to take this action in order to protect the business and secure the best possible future for Casual Dining Group as we look to conclude a potential sale."

Administrators said they were looking to help the group achieve a sale to protect jobs.

Joint administrator Clare Kennedy of Alix Partners said: "Our immediate priorities are to assist those whose employment has been affected by today's announcement and to secure a sale for the group in order to protect jobs and provide the group's much-loved brands with a sustainable platform for the future."

It comes at a particularly challenging time for the hospitality sector following over 100 days of a nationwide lockdown put in place to fight the COVID-19 pandemic.

Although the prime minister had announced a further easing of lockdown measures due to take place on Saturday to allow pubs, restaurants and hairdressers to reopen, along with a relaxation of the two meter rule, it appears the financial fallout for many in the hospitality sector has already taken its toll.

Casual Dining Group administration
Most of the closures will affect affect the Cafe Rouge and Bella Italia chains Getty

On Monday, burger chain Byron, which employs 1,200 staff, announced it had appointed KPMG as administrators, as the company holds detailed talks over a rescue sale.

SSP Group which owns Upper Crust, also says up to 5,000 jobs could be cut across its U.K. outlets and head office.

Most of SSP's food and drink outlets are located at railway stations and airports, meaning it has been particularly hit by the fall in passenger numbers as a result of the lockdown.

The Bank of England has previously warned that the U.K. faces its worst recession in 300 years, with the economy shrinking by 20.4 percent in April - the largest monthly fall on record.

It comes as Prime Minister Boris Johnson promised a "New Deal" and a 'Rooseveltian' spending boost to help the U.K. economy in light of the impact COVID-19, setting out plans to accelerate £5 billion on infrastructure projects and "level up" the economy.