Preston's Patisserie Valerie to remain open while company looks for a buyer

Patisserie Valerie in Preston
Patisserie Valerie in Preston
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Preston's Patisserie Valerie will continue trading despite 71 stores closing throughout the country.

Administrators to failed cake chain Patisserie Valerie have confirmed the closure of 71 stores, resulting in 920 redundancies.

KPMG, which was appointed on Tuesday evening, said the number consists of 27 standalone stores, 19 Druckers outlets and 25 Patisserie Valerie concessions in Debenhams, Next and at motorway service areas. The company's bakery in Spitalfields has also closed.

The remaining 122 outlets - which includes Preston will continue to trade while the professional services firm seeks a buyer for the business.

David Costley-Wood, partner at KPMG and joint administrator, said: "Since our appointment less than 24 hours ago, we have been pleased with the level of interest we have received in the business, and so remain hopeful of achieving a positive outcome.

"In the meantime, we can reassure customers that across the remaining 122 stores, it is all but business as usual."

Prior to its collapse, the cake chain employed more than 3,000.

Patisserie Valerie said on Tuesday that discussions with its lenders HSBC and Barclays to extend a standstill agreement on its debts had failed, leaving it with no option but to call in corporate undertakers.

The cake firm's parent company Patisserie Holdings has been grappling with the fallout of an accounting fraud since October.

It said that the extent of fraud meant it was unable to renew its bank loans and it did not have sufficient funding to continue trading.

Chairman Luke Johnson has extended an unsecured, interest-free loan to help ensure that the January wages are paid to all staff working in the ongoing business.

Last week, Patisserie revealed KPMG had been hired to carry out a review of all options following the accounting scandal which pushed it close to collapse in 2018.

It also unveiled the "devastating" extent of irregularities in its books, which included thousands of false entries into the company's ledgers.

The firm said an initial investigation pointed to cashflow and profitability being worse than previously thought when the problem was first discovered in October.

The discovery of a black hole in the company's accounts in October last year pushed it into a full blown crisis which saw it almost cease trading.