Lawrence Wosskow and Simon Heath, the founders of Out of Town Restaurant Group, have bought the Little Chef chain from Permira in a cash deal valued at £52m.
Under their new vehicle, The People’s Restaurant Group, the restaurant entrepreneurs plan to return Little Chef to its former glory by slashing prices, improving the food offering and “re-igniting the passion and belief of the British public”.
Heath, People’s Restaurant CEO, said: “Little Chef has to be all things to all road users; it has to become ‘The People’s Restaurant’, accessible to everyone with competitive pricing and a quality and varied food offer which spans the whole day.
“We want to champion the return of consumers supporting Little Chef, a truly great British icon. There’s enormous potential to work together with the wonderful team of people that are already on board. We intend to bring the brand back to where it deserves to be.”
The People’s Restaurant Group plans to reopen 14 Little Chef sites that are currently not trading, which it regards as “crucial outlets to service major parts of the country".
The deal includes 113 Little Chefs that sit alongside Travelodge sites, which Permira had been expected to retain.
The two companies have worked out “mutually satisfactory arrangements” to ensure they remain operational.
Wosskow and Heath intend to turn these into quality hotel restaurants that “come alive at night”, featuring bar services and evening menus.
Permira announced in November 2004 that it planned to sell the restaurant business to focus on its hotel operation.
It acquired Little Chef when it bought Travelodge from Compass in 2003.
Travelodge chief executive Grant Hearn said: “We are delighted to agree the successful sale of Little Chef, which secures the future of the business under the ownership of a dedicated and experienced restaurant operator.
“Our disengagement from direct ownership of restaurants means that Travelodge is now purely focused on budget hotels and we can now concentrate on extending our leadership position as the fastest growing hotel company in the UK.”
Permira is expected to seek a stock market listing for Travelodge in 2006.
