SFI sell-offs to help recovery programme
SFI Group has agreed a management buyout of its For Your Eyes Only (FYEO) table dancing business.
The operator of the Bar Med, Litten Tree and Slug & Lettuce brands is expected to inform shareholders in the next week or so that it has agreed the sale of three of the five FYEO outlets, along with a development site in Croydon, to a team led by FYEO operations director Glen Nicie.
SFI, which delisted from the stock market in May, will also report that it has sold two of its three Innlodge budget hotels to Greene King for around £7 million.
The cash from the sales is intended to give SFI more breathing space with its banks while it negotiates longer-term refinancing to get the business back on course. SFI revealed a £20 million black hole in its accounts last November, which ultimately led to the suspension of its shares.
The company has been granted an extension to its £130 million-plus debt facility until June 2005 in December. A working capital and overdraft facility totalling £17.5 million was due to expire in June, but is understood to have been extended.
Executive chairman Stuart Lawson, who joined the business in June to lead the recovery programme, is understtod to have been wairing until all the arrangements were finalised before writing to investors with details of the disposals made and an update on the talks with its bankers.
SFI's difficulties are the subject of an investigation by the Financial Services Authority, focusing on stock exchange announcements made between its full year results in July and the suspension of its shares in November.
Related articles:
SFI abandons the stock market (15 April 2003)
SFI scraps plans to sell Bar Med (10 April 2003)
Troubled SFI Group delays results (13 March 2003)
SFI bars for sale? (6 February 2003)
