Ramsay admits restaurants came close to collapse

01 June 2009 by
Ramsay admits restaurants came close to collapse

Gordon Ramsay has publicly admitted for the first time that his restaurant business came close to collapse earlier this year.

Speculation was rife in January that Gordon Ramsay Holdings (GRH) had breached covenants on a £10m loan and £500,000 overdraft with Royal Bank of Scotland, but this was dismissed at the time as "completely inaccurate" by Ramsay's representatives.

A separate investigation by HM Revenue & Customs found that the company owed £7.2m in taxes.

"We went over our overdraft limit and we did not hit revenue targets," Ramsay told The Sunday Times. "It was the worst bollocking ever - they told me I was fu**ed. They said we should plan for administration. That it would be smoother for everyone."

KPMG wanted to take control of GRH to "cherry-pick the winners and say goodbye to the losers", Ramsay said.

The revelations highlight the motivation for GRH giving up control of its restaurants in Paris, Los Angeles and Prague to the hotels they are housed in.

Other steps included reducing the number of covers in other restaurants, sacking a quarter of the staff at the London head office and Ramsay and GRH chief executive Chris Hutcheson sinking £5m of their own money into the company. They used the cash to pay off debt and most of the £7.2m in outstanding taxes.

"It's been very painful," Ramsay said. "It's taken several million pounds of my own money but I'm still standing."

Ramsay expects KPMG, which is finalising its report on GRH for RBS, to give the company a clean bill of health.

Gordon Ramsay Holdings hands back control of Maze Prague >>

Gordon Ramsay hands over control of Hollywood restaurant >>

Gordon Ramsay sells a third overseas restaurant >>

Head of operations at Gordon Ramsay Holdings to leave >>

Gordon Ramsay serving pre-prepared food, report reveals >>

By Daniel Thomas

E-mail your comments to Daniel Thomas here.

Caterersearch.com jobs
Looking for a new job? Find your next restaurant job here with Caterersearch.com jobs

Blogs on Caterersearch.com](http://www.caterersearch.com/blogs) Catch up with more news and gossip on all Caterer's blogs
[Newsletters For the latest hospitality news, sign up for our e-mail newsletters.
The Caterer Breakfast Briefing Email

Start the working day with The Caterer’s free breakfast briefing email

Sign Up and manage your preferences below

Check mark icon
Thank you

You have successfully signed up for the Caterer Breakfast Briefing Email and will hear from us soon!

Jacobs Media is honoured to be the recipient of the 2020 Queen's Award for Enterprise.

The highest official awards for UK businesses since being established by royal warrant in 1965. Read more.


Ad Blocker detected

We have noticed you are using an adblocker and – although we support freedom of choice – we would like to ask you to enable ads on our site. They are an important revenue source which supports free access of our website's content, especially during the COVID-19 crisis.

trade tracker pixel tracking