Gusto restaurant chain set to be sold out of administration, with almost 200 jobs lost

Italian restaurant chain Gusto is poised to be taken over through a pre-pack administration deal, which will lead to the closure of about half its restaurants and the loss of nearly 200 jobs.

Cherry Equity Partners, the investment firm headed by hospitality veterans Ed Standring and Jamie Barber, will acquire seven of the chain’s 13 restaurants, preserving over 300 jobs.

However, the deal will lead to the closure of six restaurants, resulting in approximately 190 redundancies.

Most of the affected sites are smaller, suburban restaurants that administrator Interpath Advisory said had become “economically unviable due to ongoing cost pressures impacting the sector.”

Paul Moran, Gusto chief executive, said: “We are profoundly sorry to see six of our restaurants close and are tremendously grateful for the support of our staff and our loyal customers at these locations over the years.”

Moran stated that the sale had secured the future of the business and established a stable foundation for future growth.

This deal marks Cherry Equity Partners’ third acquisition this year, following their purchase of Latin American restaurant group Cabana in January and French-themed chain Bistrot Pierre in March.

Barber said: “Gusto is a well-loved brand with a great heritage, and we’re looking forward to working with Paul and the team to invest and grow the business.”

Gusto was founded in 2005 by Jeremy Roberts and the late Tim Bacon, co-founders of Living Ventures Group.

In 2014, the restaurant chain secured investment from private equity firm Palatine, which funded its growth plans with millions in the years that followed.

However, during the pandemic in 2020, the business entered a company voluntary arrangement, which safeguarded over 600 jobs but resulted in the closure of four sites.

At the time, the business stated that the restructuring had left it well-funded and positioned strongly for growth.

Will Wright, UK chief executive of Interpath Advisory, said: “Although these continue to be challenging times for hospitality operators, we are pleased to advise on this transaction which will safeguard the future of a fantastic brand which has been serving customers across cities and suburbs for over 20 years.”

Last year, Gusto closed its Didsbury restaurant after the site was taken over by high street retailer Oliver Bonas.