The Restaurant Group offers Big Table Group £7.5m to take Chiquito's and Frankie & Benny's

The Restaurant Group (TRG) has agreed to pay the Big Table Group £7.5m as part of a deal to take Chiquito's and Frankie & Benny's off its hands.

Big Table Group will pay a token £1 for the 75 loss making sites in TRG's leisure division, while TRG will contribute £7.5m to the Big Table Group subject to certain conditions.

Last week TRG announced it was accelerating plans to reduce the footprint of its leisure business from 116 sites to 76 due to poor trading at the two casual dining brands it is offloading. It also revealed that chairman Ken Hanna would step down next year.

Lately the brands have been viewed as holding back progress at TRG, with like-for-like sales at Chiquito's and Frankie & Benny's down 3% so far this year, contrasting with 9% in like-for-likes over the same period at Wagamama, which is part of the same group.

TRG chief executive Andy Hornby said: "A sale of our Leisure business significantly accelerates our medium-term strategic plans to increase Adjusted EBITDA margins and reduce leverage.

"On behalf of TRG, I would like to express our massive thanks to the extraordinarily hardworking and dedicated teams across the Leisure business who have made huge improvements in the customer proposition over the last few years. We wish them all well as part of the Big Table Group."

Alan Morgan, chief executive at the Big Table Group, added: "Creating, developing and acquiring brands that complement our existing portfolio whilst offering widespread consumer appeal is a fundamental part of our growth strategy. This exciting acquisition forms part of that strategy and we are delighted to be welcoming this new team into The Big Table Group."

The transaction is expected to complete in early Q4 2023.