Many staff laid off as Fatty's calls receiver

13 July 2000
Many staff laid off as Fatty's calls receiver

Fatty Arbuckles, the US-style diner chain, has gone into receivership. A number of its restaurants have closed and many staff have been laid off.

Alan Bloom and Andrew Wollaston, of accountant Ernst & Young, have been appointed joint administrative receivers.

They have been holding negotiations with a funded management buyout team. There was speculation that the team would be ready to buy back 10 of the chain's most successful restaurants by yesterday (12 July).

These include Salford Quays in Manchester, Surrey Quays in London and Kettering in Northamptonshire.

Industry deal-maker Robert Breare was being tipped to head the buyout team. He was unavailable for comment.

Last month, Breare joined forces with Taipan Taverns to launch Noble House Leisure, a company that will target acquisitions in the pub-restaurant sector (Caterer, 29 June, page 10).

An insider said: "There is hearsay that he [Breare] has invested £1m to buy the restaurants."

There are more than 50 Fatty Arbuckles restaurants. Half are owned and the others are operated under franchise.

Bloom said that many of the owned restaurants had closed because they had been "heavily loss-making for some time".

He added: "As far as the rest of the business is concerned, it will continue as normal as a going concern. The retail operations under franchise will continue to operate as normal."

One assistant manager, who was laid off, said: "We were laid off with no money, no holiday pay, nothing. Then some of the top managers were told, ‘Don't worry, everything will be okay on Wednesday'."

She continued: "A lot of people have mortgages and kids, and they have nothing. It is very unfair how it has been done. It has been done so the big boys come out smelling of roses."

by Louise Bozec

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