A winding-up petition against Patisserie Holdings’ trading subsidiary Stonebeach Limited has been dismissed by the courts.

Earlier this month, the businesses announced serious accounting irregularities and the urgent need for a £20m capital injection to save the business.

The Patisserie Holdings’ board also became aware of a winding-up petition filed at the High Court, advertised in the London Gazette on 5 October 2018, related to £1.14m owed to HMRC by Stonebeach.

The company has today (24 October) said the winding-up order has been dismissed by the High Court of Justice, Business and Property Courts. Winding-up orders are typically dismissed when a business pays what is owed, or has reached an agreement to pay back what is owed.

Patisserie Holdings resolved its short-term crisis with a share offer that raised £15.7m, while company chairman Luke Johnson has loaned the business £10m under a three-year term on an interest-free/fee-free basis, and is providing a bridging loan of up to £10m to be paid back from the share offer.

This means the company, which operates more than 150 Patisserie Valerie sites and around 50 sites under other brands (see below), can continue trading in its current form for the foreseeable future on completion of the fundraising.

Finance director Chris Marsh was suspended from his role this month, and has since been arrested and bailed.

The company’s shares remain suspended from trading on AIM and this is expected to continue until the financial position is clearer.

Patisserie Holdings

Total number of sites: 206 *

Brands: Patisserie Valerie (153 sites), Philpotts (22), Druckers (20), Baker and Spice (4), Flour Power City Bakery (1)

Employees: 3,200

Food/drink split (2017): 57/43

Eat in/takeaway split (2017): 65/35

Turnover: £60.5m (six months to 31 March 2018)

EBITDA: £13.6m (six months to 31 March 2018)

HQ location: Birmingham

Key management: Paul May, CEO; Luke Johnson, chairman

Patisserie Holdings has a vertical supply chain, producing goods in-house at seven bakeries and delivering them to stores. Products are also sold online.

Since acquiring the Patisserie Valerie business in 2006, the business has expanded rapidly through acquisitions and openings to more than 200 sites. In its current financial year, the business has been aiming to open 20 stores.

Timeline

  • 1926: First Patisserie Valerie café opened in Frith Street in London’s Soho by Madame Valerie to introduce Continental-style patisserie to the English
  • 1939-1945: Café destroyed by bombing in Second World War, and Madame Valerie opens new Patisserie Valerie on nearby Old Compton Street
  • 1945-2005: Patisserie Valerie grows to eight sites in central London
  • 2006: Luke Johnson’s private equity firm Risk Capital Partners backs acquisition of Patisserie Valerie by Patisserie Holdings
  • 2007: Acquires Druckers – Vienna Patisserie
  • 2009: Acquires Baker & Spice, which operates sites in London and Oxford
  • 2013: Acquires London-based organic bakery Flour Power City Bakery
  • 2014: Acquires the Philpotts food supply and café chain
  • 2014: Patisserie Holdings listed on Alternative Investment Market
  • 2016: Annual sales exceed £100m for the first time
  • 2017: Launches trial partnership with Sainsbury’s, selling branded products on 12 supermarket counters. Partnership is a success and has since been expanded to 70 stores.

2018

  • 10 October (AM): Share trading suspended as company launches investigation into serious accounting irregularities. Chief financial officer Chris Marsh suspended.
  • 10 October (PM): Winding-up petition filed at the High Court relating to £1.14m owed to HMRC by Stonebeach Limited, the company’s principal trading subsidiary.
  • 11 October: Patisserie Holdings reports it cannot continue to trade in its current form without immediate cash injection.
  • 12 October: Chris Marsh arrested by police and released on bail.
  • 15 October: Share offer raises £15.7m to help Patisserie Holdings continue trading, while chairman Luke Johnson provides £20m in loans.
  • 24 October: Stonebeach winding-up order is dismissed.

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