JD Wetherspoon chairman Tim Martin and Jamie Oliver are arguably the two most high-profile spokespeople for the UK’s eating and drinking-out sector. So it’s a pity their current views on a sugar tax on soft drinks differ, especially when it seems there is a more obvious target for them to come together to campaign against in the form of adding VAT to supermarket ready meals. Read more
Private equity group Electra Partners has said the valuation of TGI Fridays has increased by 17% and Original Bowling Company by 103% since its investments in the companies. Read more
Weekend press round-up, 24-25 October
Ed’s Easy Diner duo eyes £20m payday
The two entrepreneurs behind Ed’s Easy Diner are set for a £20m windfall from the sale of the 1950s America-themed chain.
Ed’s, run by chief executive Andrew Guy and chairman Stephen Greene, is under auction and is expected to change hands for more than £100m.
Guy and Greene are said to hold a 20% stake between them and to share the rest with management and relatives.
The restaurant is known for its classic American menu, serving milkshakes, burgers and hotdogs. It has 34 outlets in Britain employing 726 people, according to its most recent set of accounts.
The American buyout giant TPG, which owns the Prezzo restaurants, is bidding. It is vying with Bowmark Capital, the former backer of Las Iguanas, City sources said. Other bidders are also said to be eyeing the business.
Ed’s Easy Diner made underlying earnings of £5.8m last year but is projected to take in closer to £10m this year. It lost £262,000 last year, according to accounts filed at Companies House.
A sale would provide a windfall for Greene, who bought the company for just £1.7m in 2009 from the family trust of Ed’s late founder, Barry Margolis. Ed’s and TPG were unavailable for comment, while Bowmark declined to comment.
American raider takes fresh swing at Electra
American corporate raider Ed Bramson has fired a fresh broadside at City buyout fund Electra, calling for an overhaul of its governance and questioning the relationship it has with its dealmakers.
Bramson, who runs New York-based Sherborne Investors, is mounting an activist campaign against FTSE 250 listed Electra, which owns the TGI Fridays restaurants and Park Resorts holiday parks. He claims Electra is not doing enough to hold to account Electra Partners, the offshoot that manages its companies.
Bramson will try to win two seats on the Electra board at a shareholder meeting on November 5. Last week he accused Electra of failing to scrutinise the data presented to it by Electra Partners. He likened the relationship between the pair to “Stockholm syndrome”, where hostages empathise with their captors. “What is it that causes them to say nothing can be done to improve things? I don’t think the board has looked at the right numbers,” he said.
Bramson, whose firm owns nearly 30% of Electra, said the results were likely to have given too much weight to successful companies and failed to take into account struggling companies in its portfolio. Sherborne also believes Electra’s valuation of its businesses is too high.
Sherborne believes it can boost Electra’s share price from about £36 to £60 in the next three years by scrutinising Electra Partners and redirecting funds to better performing companies.
Bramson’s comments, strongly rejected by Electra, are likely to fan the flames of a row that has lasted more than 18 months.
Electra is to announce results tomorrow that are expected to show an improvement in performance. They have been brought forward ahead of the extraordinary meeting. Electra’s share price closed at £36.35, giving it a market value of £1.2bn.
Windows of opportunity: how takeaways got posh
Lots of restaurants struggle with surges. Often there are longueurs through the morning and afternoon, punctuated by paroxysms of demand as the lunch and dinner crowds pile in. How can you satisfy all those ravenous people without having an enormous restaurant that you still have to heat, staff and pay rent on during the hours when nobody’s hungry?
Hatches are one answer. A hole in the wall where passersby can pick up your product while barely breaking stride. Last week meatball impresario Jez Felwick opened the Bowler, on Monmouth Street in London’s Covent Garden. It’s his first site after four years making his name from a food van. He has been supported by Russell Norman, the founder of Polpo, who has also made meatballs a speciality.
“It’s called the Bowler because we deliver great balls,” Felwick says. “The hatch is called the Fast Bowler because we deliver great fast balls.”
For £5, customers can lean in and pick up a box of meatballs, sauces and sides. Jez says that serving out of a window has a reassuringly familiar air.
“I was keen on the restaurant being a takeaway site rather than sit-down, and it needed to have that link to the van. The hatch brings back memories of feeding people through the window. You can interact with the customers. Also, the guys working in the kitchen can peer out and see what’s going on in the street.”
They only offer one sort of meatball per day out of the window. “There’s a new trend where people are prioritising quality over choice. With coffee, I would far rather a choice of two really good ones, served quickly, than all the faffing around over 20 different types. People have an hour at lunchtime, and they want to capitalise on it. We want to say to them: ‘This is good, trust me – take it.’”
As well as being an efficient use of space, hatches are a reflection of the scene across London and other foodie British cities. Dishes rather than spaces are becoming venerated. A certain kind of customer doesn’t mind standing in the street as long as they are clutching the right sort of burrito or organic pizza.
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Grub Kitchen: Welcome to Britain’s first insect restaurant
Ordinarily, an exclamation of: “Waiter, there’s a fly in my soup!” would result in a grovelling apology from the restaurant manager. In Grub Kitchen, however, staff would likely respond with a polite: “Is everything to your taste?”
Britain’s first insect restaurant, in Pembrokeshire, south-west Wales, is due to open its doors next week and the head chef is confident diners will “love” his bug-laden dishes.
“I’ve always been really interested in trying to do something different with food,” Andy Holcroft said. “I want to make people think about their food.”
The award-winning chef is a passionate advocate of entomophagy – eating insects. At least two billion people worldwide already do so, with about 1,900 species commonly consumed, according to the Food and Agriculture Organisation at the United Nations.
Eating insects for protein is increasingly popular in other EU countries such as the Netherlands, and Mr Holcroft believes his restaurant in Haverfordwest will be a step towards normalising it here.
He has conducted extensive market research to finesse his menu. “The first dish I created was a mealworm and cricket kofte kebab,” he said. He subsequently developed the restaurant’s signature bug burger – a blend of toasted crickets, mealworms and grasshoppers, mixed with spinach, sundried tomato and seasonings – and experimented with more exotic nibbles, from cheesy locust croquettes to bamboo worm pad Thai curry.
There is no current UK law on how to breed insects for human consumption. The critters served at Grub Kitchen are bred in laboratories and imported from a variety of European firms, but Mr Holcroft is in talks with the Food Standards Agency and hopes to be breeding his own supply by next year.
Pub of the year gives new meaning to fast food
A 16th-century “real drinking pub” that changes its menu throughout the day as fresh produce arrives has been named the best in the UK and Ireland by the Michelin guide.
The Butchers Arms in Eldersfield, north of Gloucester, won the Pub of the Year 2016 title ahead of almost 600 others despite having room for only 25 diners at any one time.
The husband-and-wife team of James and Elizabeth Winter impressed the judges with their relaxed setting and the simple yet refined British food.
Items on the ever-changing menu include fish from Cornish day boats, locally shot game in season, Middle White pork, three-quarter bred Beltex cross lamb and Hereford beef from nearby farms.
The cosy pub is no stranger to accolades, having been awarded a Michelin star in 2011, with Mr Winter’s cooking said to have gone from strength to strength. Despite the culinary variations, the food is described as proudly British and the chef sticks with “keeping it simple”.
Rebecca Burr, the guide’s editor, said: “When they started out, owners James and Elizabeth’s aim was to open a real country pub, a laid-back home from home where the locals could come to meet after work and have a good meal — and, despite their runaway culinary success, that’s exactly the way it has stayed.
“Unusually James works alone in the kitchen, and the key to his success is that he isn’t afraid to keep things simple. His cooking is proudly British and classically based but it is also refined, carefully measured and packed with flavour — and he clearly knows how to get the best out of his ingredients, whether its lamb faggots with black pudding or fillet of beef with mini oxtail pie.”
Mr Winter said: “I’ve been cooking the food I love to eat for the past eight years at the Butchers Arms, so it’s great to hear that other people love it as much as I do.”
Dozy French hit bars for lunchtime snooze
After a night of partying and an early start in his stressful insurance job, Anthony Reynier felt the need to unwind at midday. “I’ve just had a great nap,” he said as he emerged from a hammock in ZZZen, a siesta bar in the heart of Paris.
The establishment was the first in France to offer a sleep for fees ranging from €12 (£8.50) for a 15-minute micro siesta to €27 (£19.50) for a 45-minute royal siesta.
It has been followed by similar bars in towns including Belfort, Lille, Nantes and Marseilles in what Christophe Chanhsavang, the founder of ZZZen, calls a “veritable social trend”.
Envoyé Spécial, the French equivalent of the BBC’s Panorama, recently said that a third of French managers had fallen asleep in a meeting — and added that the nation’s wellbeing and productivity would benefit if all executives followed their example. Le Monde is also on the campaign trail, publishing a long article this week on a scientific study showing that siestas diminish stress and sensitivity to pain.
The French office of Robert Half, a human resources consultancy, conducted research which found that 17 per cent of French HR managers thought it was acceptable for employees to sleep at work. This, it said, was a welcome development.
La sieste is a longstanding French custom that is coming back into fashion in a new way. Workers used to take two hours for lunch and would often pop home for a plate of steak and chips washed down with a glass of red wine and followed by a nap.
Now the average lunch break lasts 22 minutes and the average journey time between home and work is 43 minutes. Doctors, commentators and a growing number of executives say that the result is an irritable and unproductive labour force.
Mr Chanhsavang discovered the downside of modern working life when he went to work for JP Morgan Chase, the investment bank, in London. The taxi would arrive at 5am and at lunchtime his colleagues just had a sandwich at their desks.
ZZZen is his attempt to stop such habits crossing the Channel. “We get people wandering around the shops who come in to relax and men who come in to improve their performance,” he said. “They think they will be better at work afterwards.”
Beer boss brews £90m bonanza
The chief executive of SAB Miller could be in line for a payout of up to £90m if, as expected, the British brewer is bought by Anheuser-Busch InBev this week.
Alan Clark is sitting on a mountain of shares and options accrued over a 25-year career at the Peroni maker.
SAB is set to announce the terms of a £44-a-share deal with Budweiser brewer AB InBev by Wednesday, when a deadline set by the Takeover Panel expires.
The two sides have reached an agreement in principle, valuing SAB at about £70bn and making it the biggest takeover of a UK company.
Market sources are confident the deal will go through, despite a number of competition issues in America and China. It is extremely unlikely that Clark would remain at the merged company.
At a share price of £44, Clark’s stake would be worth £15.5m. He then has options worth a further £55.5m and performance-related awards valued at another £10m.
Clark also has a further bonus scheme linked to the performance of SAB’s shares against a peer group of global beverage and consumer goods companies.
The stock has outstripped many rivals in recent years, partly because of constant takeover speculation. The value share award scheme could be worth a further £10m.
Executives forced to leave after a takeover are typically paid their options in full, although SAB insiders say no decision has been made yet.
Shopping spree keeps economy on track
Britain’s shoppers lifted the economy out of a late-summer soft patch, official figures are likely to reveal this week.
The economy is expected to have grown 0.6% in the third quarter, down only slightly from 0.7% in the previous three months, after consumers went on a spending spree in September.
Economists had been braced for a slowdown to 0.5% or 0.4%, but the strength of retail sales has convinced many that Britain has been able to shrug off the global downturn.
“The acceleration in retail sales growth suggests domestic demand held up in the third quarter despite growing international risks,” said Kallum Pickering, senior UK economist at Berenberg, the investment bank.
“This gives an early hint that while the pace of economic growth may have slowed a little in the third quarter as a result of financial market turbulence … the economy grew by 0.6% quarter on quarter.”
The Office for National Statistics said retail sales rose 1.9% in September and 6.5% over the year. The boom was led by a 2.3% monthly rise in food and drink sales, boosted by the rugby World cup.
Households have been lifted by record levels of employment, wage growth of about 3% a year and “good” deflation. Prices for goods and services fell 0.1% in September and inflation has been hovering around zero for much of the year.
Currency fluctuations halve earnings at Sir Rocco Forte’s luxury hotel group
Profits have halved at businessman Sir Rocco Forte’s luxury hotel group as the company was hit by currency fluctuations as well as the political situation in Russia.
Directors at the group - whose hotels include two in Russia, Brown’s in London, The Balmoral in Edinburgh and Verdura spa resort in Sicily - said that ‘trading in the Russian hotels was adversely affected by the Crimean crisis, while the substantial devaluation of the rouble and the relative weakness of the euro against sterling also had a material impact on the group’s financial results’.
Turnover for the year to April 30, 2015 was down slightly from £193million to £174.5million while pre-tax profits dropped from £10.4million to £5.1million.
The company said that, excluding the exchange rate effects, sales would have risen by 2 per cent.
However, profits would have fallen anyway due to the reduced trading in Russia, higher payroll costs and ‘additional maintenance aimed at improving the guest experience.’
Mail on Sunday
Fake reviewers go to town with TripAdvisor
TripAdvisor failed to spot three fictitious holiday listings on its website even after they were pushed up the rankings using obviously fake reviews in an investigation that has exposed how easily customers can be conned on one of the world’s biggest travel sites.
Two bogus B&Bs and a non-existent walking tour of London appeared alongside genuine UK listings for more than two weeks, during which time they accumulated 18 reviews.
These reviews, like the listings, were fake and commissioned by Which? Travel magazine, to highlight how TripAdvisor was “clearly failing” to protect its customers from such sharp practices.
Its researchers paid fake reviewers to push their fictitious listings up the local rankings and then posted negative reviews to push them down again.
The disclosure comes amid growing concerns over the reliability of online reviews after an undercover investigation by The Sunday Times showed that fake paid-for recommendations could be used to secure a top spot on an Amazon bestseller list.
After our revelations, Amazon sued 1,114 fake reviewers in the US courts, citing “manipulation and deception” of their customers.
In its investigation into TripAdvisor, which boasts 38m unique visitors a month, Which? Travel took less than an hour to create listings for two B&Bs, supposedly in Surrey and Scotland, and a London walking tour starting at Trafalgar Square.
For each one all they supplied to TripAdvisor was a website, postal and email address, telephone number, credit card details and a fake name. In one case they didn’t even give a real address; just a postcode and town. Yet TripAdvisor cleared all three listings within a few days.
Mike Avery, who owns Cromwell’s bar and restaurant in Shrewsbury, experienced the reality of being targeted by an anonymous fake reviewer. In 2012 his business received a string of damaging one-star reviews, including one reading “eat here and die”, as part of a suspected blackmail campaign.
Avery claimed that he had to report the posts to police before TripAdvisor finally took them down.
“They were up there for a few weeks, during which time the distress was significant and I even considered selling up,” he said. “It’s no exaggeration to say that negative reviews like that can break a business.”
Avery has now been asked to submit evidence to the Federal Trade Commission, the American business watchdog, detailing his experiences with TripAdvisor.
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Minimum wage crackdown highlights enforcement challenge
When the government “named and shamed” 115 companies this week that failed to pay workers the minimum wage, including retailer Monsoon, it raised an issue that has been overlooked in the debate over the “national living wage”.
While employers, policymakers and economists are fretting over the economic effects of chancellor George Osborne’s policy, which starts next year, few have asked the more fundamental question of how he intends to enforce it.
The task will be large: the number of people paid the minimum wage in Britain will surge about 65 per cent in April to more than 2.5m when the new legal rate of £7.20 an hour kicks in for over-25s. By 2020, 3.8m people will be on the rate; about one in every five private sector workers.
So far, the government has relied on HM Revenue & Customs to enforce the minimum wage. Its officials follow up on complaints and conduct investigations.
The team has been beefed up since 2010 — its budget has increased from £8.1m to £13.2m — and it has been given the power to levy fines of up to £20,000 per worker on companies that underpay the minimum wage. It also started “naming and shaming” offenders in the hope of deterring others.
The government is planning to tighten up labour market enforcement ahead of the new wage rate in April. In a consultation document this month, it said it would create a director of labour market enforcement to co-ordinate the patchwork of agencies (including HMRC) that deal with the area.
There will also be a new offence of “aggravated breach of labour market legislation” for serial offenders, and the remit of the Gangmasters’ Licensing Authority will be vastly expanded so that it can investigate companies in every sector of the economy.
Britain goes to work on boardroom bias
A major assault on the male stranglehold at the top of corporate Britain will be launched next week to help women executives smash the glass ceiling.
A government-backed report will set out ambitious new targets to get more women into top business jobs — which are likely to be approved by ministers.
Lord Davies of Abersoch, the government’s adviser on gender equality in British boardrooms, is next week expected to recommend that 25 per cent of executive director positions in FTSE-100 companies are filled by women by 2020.
The peer is ramping up his goals now that his target set in 2011 to have women making up a quarter of the FTSE-100 boards was met in July. He is also expected to extend this target for non-executive directors down the food chain from the FTSE 100 to the next 250 biggest British companies.
Two government figures told The Times that they expected the David Cameron to embrace the recommendations. Nicky Morgan, the education secretary and women and equalities minister, is also likely to be a big supporter of new targets.
The number of female executive directors at the top of the UK’s biggest companies remains low. Fewer than one in ten of top executive board positions — such as the chief executive, finance director or chief operating officer — are held by women.
There are just six female chief executives in the FTSE 100: Kingfisher’s Veronique Laury; Severn Trent’s Liv Garfield; Moya Greene of Royal Mail; Alison Cooper at Imperial Tobacco; easyJet’s Carolyn McCall and the recently appointed Alison Brittain of Whitbread. Harriet Green, the businesswoman, was the chief executive of Thomas Cook from July 2012 to November 2014.
There are 15 boards in the FTSE 250 that have no women at all — although when Lord Davies launched his review in 2011, there were 152 all-male boards across Britain’s top 350 companies.
Children too busy online for drinking and smoking
Teenagers are drinking and smoking less than they did a decade ago as they spend more time online than being rowdy with friends, new research has shown.
The percentage of 14 and 15 year old boys who have drunk alcohol in the past seven days has dropped from 32 per cent last year to just 15 per cent this year.
Separately, in the last decade the percentage of both girls and boys who drink and smoke has dropped sharply, according to data by the Schools and Students Health Education Unit (SHEU).
In 2005 the percentage of boys who drank alcohol within the past week stood at 37 per cent for boys and 41 per cent for girls. The percentages stand at 15 per cent and 26 per cent respectively.
A decade ago, 16 per cent of boys said they smoke regularly and 26 per cent of girls said they did so as well. The figures are now 9 per cent for boys and 18 per cent for girls.
David Regis, research manager at the SHEU said: “There has been a generational decrease in unwelcome behaviour across the Western World in adults and young people since the mid 1990s.
“It is a bit mysterious as to why that’s the case. It may have something to do with an improvement of the economy, health education messages finally getting through, behaviours shifting online or a combination.
“If it’s more interesting to be chatting online than messing around behind the bus shelter I can understand why a displacement theory can be argued for. There is no evidence in our figures but I am not in disagreement with it.”
Cameron under pressure as public backs sugar tax
David Cameron is facing renewed demands to embrace a sugar tax to tackle Britain’s growing obesity crisis after a new poll found more than half of voters backed the idea.
Support for a levy on sugary drinks and food is now running at 53%, according to the findings, shared with the Observer, of a representative sample of more than 2,000 people. ComRes asked them: “To what extent do you support or oppose the introduction of taxes on unhealthy food and drinks to improve child health?”
The poll comes at the end of a week in which the government’s health advisers recommended urgent adoption of a sugar tax, but the prime minister made clear his strong opposition to it. The disclosure that a majority favour such a move, even though it would increase the cost of many soft drinks and sweet foods, has prompted senior doctors to urge Cameron to include it in his forthcoming strategy to tackle childhood obesity.
“The groundswell of support for taxes on unhealthy food and drinks in order to improve the health of the nation is becoming increasingly difficult for government to ignore,” said Professor Neena Modi, president of the Royal College of Paediatrics and Child Health, which commissioned the poll.
A coalition of health professionals, academics, scientists, nutritionists and children’s health campaigners now wanted a sugar tax because the evidence from countries such as Mexico was that it helped reduce consumption, Modi said, adding that it was time to bin the government’s failed Responsibility Deal, which since 2010 has relied on voluntary action by food and drink firms. “We ask the prime minister to accept the clear evidence that the last five years of trying to encourage industry to voluntarily make their products healthier simply has not worked. It is unacceptable to put the health of our children, and the generations to come, at risk by placing responsibility in the hands of those with vested interests.”
NHS England chief executive Simon Stevens said: “There’s growing support for broad-based action to encourage – and where necessary force – manufacturers to decisively cut the added sugar they ladle into children’s fizzy drinks and junk food.”
But a Downing Street spokesman insisted: “The prime minister has been clear that there are more effective ways of tackling this issue than a sugar tax, which is why we are developing a comprehensive strategy looking at all the factors that contribute to a child becoming overweight.”