O'Briens seeks to sell leases as economy bites

03 July, 2009
Page 4 

The UK arm of Irish sandwich chain O'Briens, comprising 109 franchised outlets, has been put into administration in an effort to renegotiate rents and restructure the business.

The company's stores in the UK are still trading, as administrator Cameron Gunn of ReSolve Partners tries to negotiate a "significant" reduction in rents with landlords. He is also looking to sell the UK outlets' property leases, which are owned by O'Briens, to a third party.

Gunn told British Baker that he is currently in talks with several major food and drink retailers over the leases and expected the majority to be bought by a single buyer. The new lease-holders could either continue to operate the stores under the O'Briens' brand - an option favoured by O'Briens in Ireland - or try to move franchisees on and rebrand the stores.

"At present I believe it is likely that the vast majority of stores will remain branded as O'Briens. However, you never know until a deal is done," said Gunn.

Brody Sweeney, chairman of the Dublin-based group, which operates around 85 stores in Ireland, as well as international franchise stores in Germany, Australia, Saudi Arabia, Singa-pore and Thailand, said: "Our first priority is to secure jobs and the future livelihoods of our franchisees in the UK in the face of the very difficult trading conditions we have been experiencing. We are optimistic that a relatively small number of stores will be closed as part of the administration, and that the restructured group can overcome the worst downturn in our industry since we commenced trading over 20 years ago."

O'Briens' stores in Ireland are not affected by the UK arm going into administration.





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