The firm behind The French Cafe and Mamma Amalfi has been forced into administration after its sole director, James Burdall, quit.
Burdall has since been arrested by South Yorkshire Police in connection with a fraud inquiry related to the demise of Out of Town Leisure Group.
It is understood that Mr Burdall is being questioned in regards to £1 million that was siphoned off from the businesses he ran.
Neil Henry of Lines Henry in Cheshire has been brought in to act as the administrator to the eight businesses that Burdall was director to. His first task is to speak with the staff about their rights on unpaid wages and redundancy.
"The business hadn't been making money for a while and because the main director, James Burdall, had resigned the bank withdrew their banking facilities..." Mr Henry explained.
"It's too early to tell what can be rescued...At the moment there's nobody lined up to take them on. It may be that people come forward afterwards."
The group is owned by US entrepreneur Lawrence Wossokow, who bought it out of administration in 2007 and renamed it Out of Town Leisure Group. The company was established in 1998 with the name Out of Town Group.
About 350 jobs have been lost at the Yorkshire-based company, which owns several food outlets in large shopping centres. It runs The French Cafe, Mamma Amalfi, The Lounge Bar, Potato Bakehouse, and the Oriental Express.
