Bay slashes debt in new finance deal

Published: 28 July, 2009

The operator of popular restaurant chains La Tasca, Slug and Lettuce and ha ha and grill brands has undergone a financial restructuring that will see its debts slashed by £100m.

Bay Restaurant Group will now have a new £150m debt facility under new banking terms agreed with Kaupthing and Commerzbank. The facility will remain in place until 2012.

Management at Bay - the fourth largest UK restaurant group - are also being offered a significant equity stake as an incentive.

The cash-for-equity deal will mean that the company's assets will remain intact.

Bay generates approximately £25m of earnings before tax, depreciation and amortisation on an annual basis.

The company has grown over the past two years and has invested £15m across its three brands.

Bay's directors were upbeat after the announcement of the refinancing.

Paul Symonds, chief executive of the company said: "We are delighted to have secured supportive refinancing from our banks which puts the group on a secure financial footing for the future. Our brands have continued to trade well in spite of widely documented challenging market conditions. This transaction will enable us to continue to invest and grow our business, provide incentives and motivate our management team and staff and firmly provides the group with the opportunity to continue to outperform in our market. The directors look forward to the future with confidence."

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