The UK operator of TGI Fridays has entered administration as it seeks to sell its chain of 87 restaurants across the country. Hospitality firm Hostmore has appointed joint administrators from Teneo and is working to secure a sale of the UK restaurants by the end of September.
What Does Administration Mean for TGI Fridays?
The administration process raises uncertainty for the popular American-inspired restaurant chain, but Hostmore hopes to keep the brand alive on British high streets. If the sale is successful, it would mean that the TGI Fridays brand will continue to operate, saving thousands of jobs and preventing closures.
However, Hostmore warned earlier this month that it does not expect to “recover any meaningful value” from the sale of its sites, indicating that the proceeds from the sale may fall short of its obligations to creditors and banks. It remains unclear whether the company will secure a buyer for the entire chain or if only some of the restaurants will be sold.
Will TGI Fridays Stay Open During Administration?
For now, TGI Fridays restaurants in the UK remain open for business as the administration process unfolds, allowing customers to continue enjoying meals and drinks as usual.
Collapse Follows Failed Takeover Deal
The collapse of Hostmore comes after plans to acquire the US-based TGI Fridays Inc. for £177 million fell through earlier this month. The proposed merger would have created a larger company, keeping TGI Fridays listed on the London Stock Exchange. However, the deal was abandoned following a management change, preventing Hostmore from collecting royalties from the TGI Fridays brand.
As a result, Hostmore’s shares plummeted by more than 90%, and its shares, now valued at less than 0.2 pence, have been suspended from the stock exchange. The company is set to be delisted and wound up.
Despite the challenges in the UK, TGI Fridays continues to operate in its primary market in the US, where it runs 128 restaurants, as well as more than 270 locations worldwide, including franchised sites.
