V8 Gourmet Group, the operator of the Bombay Bicycle brand, is in talks with a trade buyer over a sale of the business, after a winding up motion against the company by HRMC was adjourned, M&C Report has learnt.
Managing director Arjun Varma told M&C Report that the company, which had previously been in talks over new investment, was now in “advanced negotiations with a large trade group” regarding the sale of its core estate and its wholesale business.
He said: “Our shareholders are currently in talks which we hope will safeguard the business and all the jobs.”
The group currently operates seven restaurants and concessions under the Tiffinbites brand, plus two restaurants and 13 delivery kitchens under the Bombay Bicycle brand, across the capital.
It also has a further two Tiffinbites sites in Dubai.
The company, which also operates the Tiffinbites brand, asked property advisor Cedar Dean Gilmarc to dispose of 10 outlets, predominantly in London, in December. Varma said the company had strong offers on a number of the sites.
Varma said that after the adjournment of the winding up order, the company was in talks with advisers regarding a claim for a £1.6m tax refund from the HRMC in connection with the takeaway side of its business.
The move comes after a legal ruling by the European Court of Justice (ECJ) that could pave the way for pubs and restaurants to pay no VAT on hot takeaway food and drink, and reclaim some taxes paid in the past.
The ECJ was asked by German courts to rule on whether selling hot food and hot drinks sold for “immediate consumption” should be defined as supply of goods, which are usually subject to zero VAT, or catering services, which pay the full VAT level.
The ECJ said the ‘goods’ definition should apply to food bought from snack stalls, mobile snack bars or in cinema foyers - so long as “elements” of supply of service are “not predominant”. The definition covers food and meals prepared for immediate consumption by boiling, grilling, roasting, baking “or other means”.
Over 70% of V8’s estate offers a takeaway option.
