UK Hospitality: Proposed changes to CBIL scheme still not enough for majority of sector: Kate Nicholls, chief executive of UK Hospitality, has said that changes to the Coronavirus Business Interruption Loan scheme (CBIL) would be welcomed but that those reported overnight would still do nothing for 85% of hospitality businesses. In yesterday’s daily government briefing business secretary Alok Sharma said it would “completely unacceptable” for banks to unfairly refuse funds to companies in financial difficulty as a result of the crisis. He pointed out that banks had been bailed out by taxpayers and that now it was time to “repay the favour”. This was followed by a report by Sky News last night that the chancellor Rishi Sunak was preparing to unveil an overhaul of the government’s emergency aid scheme for small businesses (SMEs) amid warnings about a deluge of insolvencies as companies struggle to access funds from a banking system creaking under the covid-19 crisis. The report said that the chancellor will announce in the coming days that a key feature of the CBIL scheme- the requirement for banks to first assess whether SMEs are eligible for their other lending options – will be removed. Under the revamped programme, any viable business with a turnover of up to £45m will be able to access the scheme, which is interest-free and fee-free for the first 12 months. Users of the programme would still be required to demonstrate that their company was viable going into the crisis, and that they have the ability to repay the loan at the end of the term. However, banks are also understood to have agreed to waive any outstanding demands for personal guarantees on loans up to £250,000. Any personal guarantees taken on loans above £250,000 will be used to cover the 20% of the loan that the government is not underwriting, according to one official. Sources told Sky News that the Treasury also wanted to see banks publicly agree to a modest ‘reversion rate’ – a reference to the interest rate to which loans would revert after the initial 12-month period. Reacting to the reported changes in the CBIL scheme, Nicholls told Propel: “While changes to the CBIL scheme are welcome for the smallest businesses, this will still do nothing for the 85% of hospitality businesses stranded in the middle without being eligible for either government lending facility and days away from running out of cash. The government needs a radical rethink – and fast – of how to get vital funds to cash-starved businesses to avoid failures and job losses. Two weeks ago, the chancellor promised a government backed loan on attractive terms for any good business who needed it to pay their rent, their salaries, their suppliers. Hospitality is still waiting and in the absence of a new facility or real change we need an urgent expansion of grants.” The warning came as a large number of companies are in danger of running out of money within weeks, according to a survey tracking the impact of coronavirus. The Times reports that the British Chambers of Commerce (BCC) found that a majority of businesses, or 62%, polled late last month said that they had enough cash to keep them going for the next three months only. Almost a fifth, or 18%, said that they had sufficient capital to cover their outlay for a month and 6% said that they had enough in reserve to sustain them for more than a year. The BCC carried out its poll, which it is calling The Covid-19 Business Impact Tracker, among more than 600 businesses between 25 and 27 March.

Land Securities establishes £80m rent relief support fund: Land Securities has announced it has established a rent relief support fund of £80m to help “our customers most in need”, with a particular focus on supporting F&B customers and small and medium sized businesses. The launch of the fund came as it said that 65% of the rent due to it on 25 March was paid by 31 March compared with 96% for the equivalent period last year. The company said: “We continue to focus on supporting our customers through this period of disruption and are agreeing rent deferrals with many of our retail and leisure occupiers. We are focused on looking after our customers, particularly those most in need. We have been working with over 300 retail, F&B and leisure customers this month to support them as best we can. We are establishing a support fund to provide up to £80m of rent relief for customers who need our help most to survive. Around £15m of this fund will support our F&B customers, broadly equivalent to three months’ rent free. The remaining £65m will be allocated on a case by case basis to small and medium sized businesses with a focus on helping those with limited access to other sources of financial assistance. We are also working with leisure and retail operators to agree deferred payment plans.”

Benito’s Hat to live on after part of business acquired out of administration: Benito’s Hat, the Mexican restaurant brand, is to live on after half of the business was acquired out of administration. New company DGMP UK Ltd is understood to have secured a deal for the business and four of the brand’s sites, in Covent Garden, Farringdon, Oxford Circus and Oxford Westgate. As revealed by Propel at the start of last month, DGMP UK includes Benito’s Hat current chief executive Mike Pearson as a director. Its other directors are Subway franchisees Martin Graves and Gabriel Moreno Carrillo. It is thought that the four restaurants will continue to operate under the Benito’s Hat name, when the sector is allowed to re-commence trading. Pico’s Ltd, the parent company of Benito’s Hat, was placed into administration last week, with Irvin Cohen and Gary Paul Shankland of Begbies Traynor appointed joint administrators of the then eight-strong business. The company underwent a company voluntary arrangement (CVA) last summer. The group’s other sites in St Albans, Bromley, King’s Cross station and at the O2 are understood not to be part of the deal. The business had been working with Begbies Traynor since January on its options, which included seeking further investment or a sale of the business. It is thought expressions of interest were sought by 6 February, with offers sought by 13 February. Propel understood the business, which generated full-year revenue of circa £4.5m, was being offered on an “accelerated sales basis”, which raised the possibility if no buyer or new investment came forward that the business would have to be placed into administration. Propel understands up to ten expressions of interest were shown in parts or all of the business. One of these was from DGMP UK. Propel understands despite the CVA process, trading at a number of the brand’s sites had remained challenging, including more recent openings in St Albans and at The O2. However, it is thought the business was forecast to return to positive Ebitda this year, before the impact of the coronavirus outbreak. Ben Fordham and Felipe Fuentes Cruz founded Benito’s Hat in London in 2008. Fordham stepped back from the business at the end of 2017.

Domino’s appoints Smith as interim CFO: Domino’s Pizza Group has announced the appointment of Neil Smith, formerly of the Ei Group, as its new interim chief financial officer with effect from 15 April. Smith most recently served as chief financial officer of Ei Group from 2011 until its recent takeover by Stonegate Pub Company. He has also served in senior finance roles at Compass Group, Virgin Media and Telewest. His appointment follows the tragic death of the group’s previous chief financial officer David Bauernfeind in December 2019. As an interim appointment, Smith will not be joining the company’s board. Matt Shattock, chairman, said: “I look forward to welcoming Neil to the group. Neil will make an excellent addition to the team at this important time.” Earlier this week, Domino’s announced the appointment of Dominic Paul, formerly of Costa Coffee, as chief executive (designate) in the UK with effect from 6 April 2020.