Gordon Ramsey Holdings was threatened with administration
Gordon Ramsay, the television chef, has admitted how he came close to losing his business empire and was threatened with administration earlier this year.
The Michelin-starred chef said his company Gordon Ramsay Holdings (GRH) was losing millions of pounds. Ramsay was so concerned about the prospect of administration that he sold his Ferrari and considered selling up to 20 per cent of the company and his £6m home in Wandsworth, south west London.
The crisis came after his company breached covenants – promises made to lenders to secure a loan – on its £500,000 overdraft and £10m of loans with Royal Bank of Scotland (RBS). ‘We went over our overdraft limit and we did not hit revenue targets,’ he said.
The bank sent in auditors KPMG to go over GRH’s books. A separate investigation by HM Revenue & Customs found that the company owed £7.2m in taxes. Auditors wanted to take control of his global restaurant group, comprising 21 restaurants and pubs. Three of his restaurants have now closed.
The star of Ramsay’s Kitchen Nightmares admitted he tried to expand the company too fast – opening 10 restaurants in 10 months last year, many of them overseas. He said, ‘Tenacity and ambition overtook me. We thought we could do anything, that we could not fail. We flew too high, too fast.’
Ramsay said he avoided administration by cutting operations in Paris, Los Angeles and Prague, reducing the number of covers in other restaurants, sacking a quarter of the staff at the London head office and sinking £5m of his own money into the company.
Ramsay expects KPMG, which is finalising its report for RBS, to give the company a clean bill of health. He hopes it will mark the end of what he calls ‘the worst year of my life’.
The 42-year-old has been dogged by allegations of a seven-year extramarital affair, allegations that his restaurant served pre-prepared ‘ready meals’ in his London pubs and claims that he had embellished his history as a Glasgow Rangers footballer.
‘It’s been very, very hard,’ he said. ‘At times it felt like a witch hunt. I’ve put my hands over my face and taken the blows.’
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