Cake chain locked in talks with lenders about debts
PUBLISHED: 09:22 21 January 2019 | UPDATED: 09:23 21 January 2019
A UK patisserie and cafe chain says it is still locked in talks with lenders as its future remained in doubt amid an accounting scandal.
The cake chain, which includes stores in Ipswich, Norwich, Bury St Edmunds and Colchester, said in a brief update that it was in discussions with HSBC and Barclays to extend a standstill agreement on its debts which expired last week.
“Patisserie Holdings plc announces today that, further to the announcement on January 16, the company is still in discussions with its bankers to extend the standstill of its bank facilities beyond January 18 and will issue an update when those discussions have concluded,” it said.
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Last week, Patisserie, chaired by Like Johnson, revealed that it has hired advisers at KPMG to carry out a review of all options following an accounting scandal which pushed it close to collapse last year.
It also unveiled the “devastating” extent of irregularities in its books, which included thousands of false entries into the company’s ledgers.
The firm said an initial investigation pointed to cashflow and profitability being worse than previously thought when the problem was first discovered in October.
The discovery of a black hole in the company’s accounts in October last year pushed it into a crisis which saw it almost cease trading.
A rescue plan was passed by shareholders in November, resulting in the issue of £15m worth of new shares.