Wed, 10 May 2023 | ADMINISTRATION
Vegan burger chain Vurger Co has been acquired out of administration by a new company formed by its founders with support from several investors. The pre-pack sale will see the chain’s Canary Wharf restaurant close, but saves three sites in Manchester, Brighton and Shoreditch.
The chain was founded in 2016 and started with a stall in Tottenham, North London, before expanding to four branches as the business grew. After opening its fourth location at Canary Wharf in 2019, however, the company's operations were impacted by the COVID-19 pandemic.
Co-founder Rachel Hugh said that the business had seen “strong growth” but that the pandemic brought “enormous challenges” and forced the firm “to move from developing and growing our brand to simply firefighting to keep our doors open”.
The chain was subsequently hit by issues relating to Brexit and the cost of living crisis, which has impacted high street footfall and consumer spending power, as well as rising prices and increases in VAT and business rates.
As a result, the company had reached a “pivotal” moment by the end of last year, asking existing investors for support and seeking a buyer for the business. A potential buyer had reportedly been found, but pulled out at the last minute, leaving the company’s founders facing the choice of either seeking additional investment or closing the business down.
However, the company has now secured the additional funding it needed, with support from new and existing investors enabling co-founders Neil Potts and Rachel Hugh to acquire the business out of administration. The founders commented that the deal would enable the business to move forward with a “restructured model”.
Insolvency and business rescue specialist McTear Williams & Woods oversaw the pre-pack sale, with the transaction completed within six working days of the firm’s advisors meeting with Vurger Co’s directors.
McTear Williams & Woods associate director and joint administrator Jo Watts commented: "Every case is different but in this instance, we were able to save jobs and the brand which in the current economic climate is a very good outcome."
In Vurger Co’s accounts for the year ending December 31 2021, its fixed assets were valued at £710,473 and current assets at £365,425. At the time, the firm’s net liabilities amounted to £469,398.
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