A BELOVED restaurant chain created by Wagamama’s founder is on the brink of collapse.
It put the future of the Thai restaurant chain, which has has six locations in the UK, in doubt.
Busaba Eathai has filed a notice of intention to appoint an administrator[/caption]
Busaba Eathai filed a notice of intention to appoint an administrator on Friday June 13 at the High Court.
The notice means that the company hasn’t yet filed for administration, leaving some uncertainty over what exactly could happen.
Alternatives to appointing an administrator are still available, including selling the brand to avoid its collapse.
The chain was launched by Wagamama founder Alan Yau in 1999, and had 16 restaurants across the UK at its peak.
However, four branches closed in 2020 following a Company Voluntary Arrangement, leaving 12 sites based in London.
Over the last few years, the chain launched several new projects to try and cope in the tumultuous restaurant industry post-pandemic.
In 2022, they opened an izakaya-inspired bar called Ajia, as well as a new restaurant in Oxford.
These didn’t last long, closing down in 2023 amidst falling profits.
Last year, the restaurant chain announced an overhaul of their London Westfield Stratford site, as well as a new trial restaurant.
They hoped to appeal to younger audiences with a range of small plates and an emphasis on drinks.
The CEO, Winston Matthews told MCA in March: “It will be a bit more vibey, more high energy, whereas Busaba is more relaxed and at the top end of premium casual dining.”
Busaba planned to trial the more budget-friendly restaurant for 18 months, but now only operate a single site at Westfield Stratford that seems to conform with the rest of the chain’s brands.
In recent months, other branches of the chain have closed including its sites in Bloomsbury and Kingston.
A Facebook post announcing their Bloomsbury closure reads: “It’s with great sadness that we announce the closure of our Bloomsbury restaurant, as our lease has come to an end.
“After many wonderful years, we’ve agreed with our landlord that it’s time to say goodbye to this beloved location.”
Just six sites of the chain remain, with five in London, and one in Lakeside Shopping Centre in Essex.
At the time of reporting all the sites remained open as usual.
What does going into administration mean?
WHEN a company enters into administration, all control is passed to an appointed administrator.
The administrator has to leverage the company’s assets and business to repay creditors any outstanding debts.
Once a company enters administration, a “moratorium” is put in place which means no legal action can be taken against it.
Administrators write to your creditors and Companies House to say they’ve been appointed.
They try to stop the company from being liquidated (closing down), and if it can’t it pays as much of a company’s debts from its remaining assets.
The administrator has eight weeks to write a statement explaining what they plan to do to move the business forward.
This must be sent to creditors, employees and Companies House and invite them to approve or amend the plans at a meeting.
A Notice of Intention is used to inform concerning parties that a company intends to enter administration.
It is a physical document which is submitted to court, usually by directors aiming to prevent a company from being liquidated.
Like with a standard administration process, a Notice of Intention stops creditors from taking out any legal action over a company while they try and rectify the business.
Busaba’s menu includes a range of curries, noodle-dishes, and grills.
Earlier this week, the chain celebrated its 25th anniversary with a 50 per cent discount on food from June 15-19.
They emphasise community, saying on their menu: “We want to bring our guests together, leaving them in a better state of mind – satisfied, rebalanced and recharged.”
The Sun has contacted Bubala and their representatives Francis Wilks and Jones for comment.
The hospitality industry has been under extra pressure in recent years, with a string closing down.
There are extra pressure on independent businesses, where restaurants, pubs and cafes have been forced to close down due to rising costs and a drop in demand from Brits, who are suffering from a drop in disposable income.
A steak chain with sites in Bristol and Cardiff announce it was closing down both restaurants in April.
While Gordon Ramsey also shut a burger restaurant in Reading in the same month.
Even well-known pizza chains have been faced with closures, like Papa Johns which confirmed that 43 of its restaurants would shut down in the coming months.
More closures could be on the horizon due to upcoming hikes in employer National Insurance Contributions (NICs) and the national minimum wage.
The chain’s six remaining stores could be affected[/caption]
