Following the news yesterday that Gaucho had filed a notice to appoint administrators, today it has been confirmed that the steakhouse group has now fallen into administration, with 22 Cau restaurants to be closed immediately and 540 jobs lost.
Administrators at Deloitte described Cau as 'significantly loss-making' after reporting three consecutive years of falling sales. However, they confirmed that Gaucho's 16 other sites will remain open while a buyer is sought for that part of the business.
Joint administrator Matt Smith said, 'Unfortunately the Cau brand has struggled in the oversupplied casual dining sector with rapid over-expansion, poor site selection, onerous lease arrangements and a fundamentally poor guest proposition all being factors in its underperformance.
'The Gaucho business on the other hand, which operates in the premium dining market, continues to trade well in its market segment, is profitable and has a strong underlying brand and guest loyalty.'
Smith added, 'We are taking steps to stabilise the business following our appointment and are now seeking expressions of interest in terms of a sale of the Gaucho business.'
Owned by the private equity firm Equistone, Gaucho specialises in Argentinean steaks and fine wine, and has restaurants in London, Birmingham, Leeds, Manchester and Edinburgh, as well as Dubai and Hong Kong. It employs 714 at Gaucho and 51 at head office.
