The business has boarded up its site in Manchester Piccadilly, according to Manchester Evening News, and has closed a site in Brighton on the city’s North Street. Pictures published by The Argus show the site to be closed, with the windows whitewashed over and the Leon sign covered up.
Leon, which operates around 70 sites in the UK, said that it would be closing underperforming and unprofitable sites after going into administration. The business then intends to emerge from administration following a Company Voluntary Arrangement early next year as a leaner business.
It said at the time of the announcement that all of its restaurants would remain open.
While the company has yet to announce how many sites it could potentially close, some reports suggest the number could be as high as 20, which would be more than a quarter of its current estate.
The business owns 44 company owned sites, 20 UK franchises and three franchise sites in the Netherlands and another one in Italy.
Nick Stockley, partner at law firm Mayo Wynne Baxter, says that placing Leon into administration means there is a chance that something can be salvaged from the business.
“There will be value in the company’s goodwill and there will be profitable outlets that will be of interest to buyers,” he says.
“Therefore, the administration process is utilised on the basis that it will offer a better return for creditors than liquidation. “The administration process also gives the company a chance to redistribute employees and keep the brand afloat.
“Given the losses, Leon has little option but to go into an insolvency measure such as administration – only time will tell if the restructure will be a long-term success.”