The closures will be concentrated to Gusto’s smaller suburban sites, which are said to have become economically unviable due to continuing cost headwinds affecting the sector, and will result in circa 190 redundancies.
Seven ‘flagship’ restaurants will continue to trade, safeguarding over 300 jobs.
“This investment marks an important step forward for Gusto, ensuring the future of the business and putting in place a strong and stable platform upon which we can start to grow the business again,” says Paul Moran, CEO of Gusto Restaurants.
“We are profoundly sorry to see six of our restaurants close and are tremendously grateful for the support of our staff and our loyal customers at these locations over the years.”
Founded in 2005 by Jeremy Roberts and the late Tim Bacon of Living Ventures Group, Gusto’s estate is primarily concentrated across the North West, Yorkshire and the Midlands.
It also has outposts as far north as Edinburgh in Scotland and as far south as Oxford.
News of the administration deal follows reports earlier this morning (29 July) that Gusto was on the verge of collapse.
The transaction is being led by Will Wright and Rick Harrison from Interpath, who are expected to be appointed joint administrators to Gusto Restaurants Limited.
“Although these continue to be challenging times for hospitality operators, we are pleased to advise on this transaction which will safeguard the future of a fantastic brand which has been serving customers across cities and suburbs for over twenty years,” says Wright.
Cherry Equity Partners is an investment platform that was set up earlier this year by Ed Standring and Jamie Barber, who previously led London-based restaurant group The Hush Collection.
Since its launch, Cherry Equity Partners has acquired Latin American-inspired bar and grill Cabana, which was previously owned by The Hush Collection, through a management buyout, and French restaurant group Bistrot Pierre via a pre-pack administration.
“This investment marks our third acquisition in six months, and underscores our deep commitment to the UK hospitality sector,” says Standring, CEO and operating partner of Cherry Equity Partners.
Barber, who is chairman and founding partner of Cherry Equity Partners, adds: “Gusto is a well-loved brand with a great heritage, and we’re looking forward to working with Paul and the team to invest and grow the business.”