Gaucho Grill to be a private company

Alternative Investment Market-listed restaurant group Gaucho Grill is to be taken private in a £13.2m deal.

Pan European Restaurants, set up for the purpose of buying Gaucho, has reached an agreement with the company's independent directors to buy the entire share capital.

Pan European is 24% owned by the Gioma group, a company in which Gaucho's chairman Zeev Godik and operations manager Jan Geenemans hold an equity interest. The other 76% of Pan European is owned by investment company Furtado, which is controlled by the same group of private investors who control Gioma.

Pan European said it did not intend to make any major changes to the business over the next 12 months and has promised to safeguard the existing employment rights of Gaucho staff.

Meanwhile, trading at Gaucho remains difficult.

Sales so far this year are about 9.4% above those achieved in the same period last year, but this is because of new restaurant openings. Like-for-like sales fell by 3.3%.

Gaucho's independent directors said that although the business had long-term potential there were still "significant risks" and uncertainties in the short to medium term.

These included economic uncertainty in general, the fall in UK tourist numbers, and uncertainty surrounding the long-term impact of BSE and foot-and-mouth on trading.

Some poorly performing restaurants may need to be closed, the directors said.

Godik and Geenemans first announced plans for a management buyout in July last year but cancelled in October because of economic uncertainties and "bad timing".

by Samantha McClary