First two Leon branches close as restaurant chain goes into administration

Leon will close 20 of its least profitable restaurants and cut jobs as part of a restructure following an £8million pre tax loss last year.

The chain, which offers a healthier take on fast food, runs 44 company-owned restaurants and has 22 franchised restaurants, but has not said how many of its 1,000-plus jobs could be lost.

According to the Guardian, it has already closed 10 since its co-founder John Vincent bought it back from Asda two months ago and complained of the industry’s “unsustainable” tax burden.

The group has hired advisers from Quantuma after applying for an administration order and said it will then form proposals for a company voluntary arrangement restructuring plan.

However, the firm said an initial review highlighted a need to “reduce the number of loss-making restaurants”.

Mr Vincent said: “In the last two years, Asda had bigger fish to fry, and Leon was always a business they didn’t feel fitted their strategy.

“If you look at the performance of Leon’s peers, you will see that everyone is facing challenges – companies are reporting significant losses due to working patterns and increasingly unsustainable taxes.”

The business has created a programme to support anyone made redundant from store closures, with employees given special application access to Pret a Manger jobs.

As well as closing the eateries, Leon is also set, from January, to scrap its £25-a-month Roast Rewards scheme, which gives payees five free coffees and discounts on food.

Which Leons will close?

Manchester Piccadilly and Brighton branches of Leon are among the first to have closed and have already been boarded up, Manchester Evening News has reported.

The Brighton Argus shared an image on Thursday of the North Street Leon with whitewashed windows.

The full list of the eateries that will close has not been revealed, although it’s understood that three of ten to have shut are overseas franchises.

Catering Today has reported that Quantuma will consider its plans in the coming weeks.