Suspended Patisserie Valerie Opportunity

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Suspended finance chief of Patisserie Valerie owner arrested overnight

The suspended finance chief of Patisserie Valerie’s parent firm was arrested by police overnight, just days after the discovery of potentially fraudulent accounting irregularities.

Patisserie Holdings said in a market announcement on Friday that Chris Marsh, who was suspended from his role earlier this week, has since been released on bail.

It comes just days after the cafe chain owner said it had discovered a major black hole in its accounts.

Patisserie Holdings said on Wednesday that it has been notified of “significant, and potentially fraudulent, accounting irregularities and therefore a potential material mis-statement of the company’s accounts”.

This significantly affected the company’s cash position, with the firm saying it could lead to a “material change” in its overall financial position.

Mr Marsh was later suspended from his role and accountancy giant PwC drafted in to look through the company’s books.

To compound its troubles, Patisserie Holdings has also received a winding-up petition for its principal trading unit Stonebeach, with a hearing now scheduled for October 31.

It relates to £1.14 million owed to HMRC.

The cake chain has now warned that it will cease trading without an “immediate” cash injection.

The firm could be forced to appoint administrators as early as Friday.

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Emergency fundraising talks overseen by advisers to Patisserie Holdings were continuing on Thursday evening. Other options on the table include a loan or a rights issue.

Chairman Luke Johnson is said to be considering stepping in with funds that could help save the business.

Mr Johnson, a serial entrepreneur, is the largest shareholder in Patisserie Holdings with a 37% stake.

If a buyer for the group does emerge, any purchase is likely be conducted via a pre-pack administration process, where a new owner is able to shed onerous liabilities.

PwC, which is working with the firm on its financial position, is the most likely to carry out the insolvency, but several other corporate undertakers are also thought to be waiting in the wings.

Patisserie Valerie trades from more than 200 stores and also has a partnership with Sainsbury’s, with branded counters present in the supermarket.

Suspended Patisserie Valerie Opportunity?

Wednesday 10 October 2020 17:03, UK

The owner of Patisserie Valerie has suspended trading in its shares amid an inquiry into potential fraud and also revealed that its main subsidiary was being pursued for more than £1m by tax authorities.

The announcement on Wednesday morning followed a story by Sky News hours earlier that Patisserie Holdings was investigating a multimillion-pound hole in its accounts that could exceed £20m.

In a later statement, the company disclosed that it had just become aware of a winding-up petition that had been filed against is main subsidiary, Stonebeach, relating to £1.14m owed to the UK tax office, HM Revenue and Customs.

It said it was in touch with HMRC “with the objective of addressing the petition”.

The company revealed in its initial statement that on Tuesday the board had “been notified of significant, and potentially fraudulent, accounting irregularities and therefore a potential material misstatement of the company’s accounts”.

It added: “This has significantly impacted the company’s cash position and may lead to a material change in its overall financial position.

“As a result the company has requested that its shares be suspended from trading on AIM while it conducts a full investigation with its legal and professional advisers into its true financial position.

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“In the meantime Chris Marsh, the chief financial officer, has been suspended from his role.

The ‎situation creates a huge headache for Luke Johnson, one of Britain’s best-known and most successful entrepreneurs, who is Patisserie Holdings’ executive chairman and largest shareholder.

He bought a 70% stake in the business in 2006 and his current 37% holding was worth approximately £200m ahead of the suspension in trading.

Mr Johnson is a serial entrepreneur who has enjoyed huge success with restaurant chains including Pizza Express – and this year, he has tried to engineer takeovers of others such as Gaucho, which collapsed into administration during the summer.

He said of the company’s inquiry: “We are all deeply concerned about this news and the potential impact on the business.

“We are determined to understand the full details of what has happened and will communicate these to investors and stakeholders as soon as possible.”

Patisserie Holdings, run by chief executive Paul May, last reported group revenue in the half-year to 31 March of £60.5m – a rise of 9.1%.

Pre-tax profits came in at £11.1m, an increase of 14%.

Patisserie Holdings trades from more than 200 stores.

Patisserie Valerie owner appoints Nick Perrin as interim CFO

(Reuters) – Scandal-hit Patisserie Holdings Plc (L: CAKEP ) said it had appointed Nick Perrin as interim chief financial officer, marking another top management change for the British cafe chain owner weeks after it appointed a new top boss.

Perrin’s appointment comes nearly two months after then CFO Chris Marsh, who was arrested following reported accounting irregularities and potential fraud.

Perrin was most recently the finance director of veterinary services provider CVS Plc (L: CVSG ), Patisserie said, adding that he had been appointed while the firm undertakes a process to appoint a permanent finance head.

The company, which owns the Patisserie Valerie chain, has been under pressure since an accounting black hole was discovered and reports emerged that its former chief executive and Marsh had been issued twice the number of shares it had disclosed in official filings, forcing both executives to step down.

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