After collapse, Coffee Republic chain set to be sold

After collapse, Coffee Republic chain set to be sold
13th July 2009

The Coffee Republic chain in mid-July was set to be sold, after being placed in administration and closing some company-owned outlets, local reports said.

The London-based chain, founded in 1995 by siblings Sahar and Bobby Hashemi, has 187 outlets in the UK and a number of international locations including the Middle East and the US. Subsidiary Coffee Republic (UK), which owns 20 of the outlets, in early July closed 11 of them, mostly in southeast England.

The subsidiary employs 153, including 127 at its outlets.

Administrators KPMG Restructuring reported in mid-July that there was strong interest in acquiring the chain, mostly from other retailers and from franchisees, who are not affected by the UK subsidiary’s problems. Coffee Republic has 70 franchised shops and a further 97 concessions in cinemas, retailers and hotels, according to the reports.

KPMG said it was hoping to sell the chain quickly, given the level of interest. In the meantime, it said, it was assessing the viability of individual outlets. The administrator blamed reduced discretionary spending because of the recession, as well as expensive leases at some of the outlets, for the chain’s problems, but added that the brand was strong and that the profitable parts of the business obviously were still attractive to buyers.