Business

Nando's to buy Gourmet Burger Kitchen firm for £30m

Nando's branch
Image caption Nando's is a familiar presence on the UK High Street

The UK arm of chicken restaurant chain Nando's has agreed a £30m deal to buy a rival firm.

It plans to take over Clapham House Group, the company behind Gourmet Burger Kitchen (GBK) and The Real Greek.

Nando's said that Clapham's brands were struggling in the volatile market and needed its investment and expertise.

There are more than 230 Nando's restaurant in the UK and Irish Republic while there are 53 GBK branches.

Clapham's board has recommended shareholders accept the offer for the firm.

Nando's, famed for its peri-peri chicken, said that economic weakness in the UK had created a difficult environment for UK restaurants.

"It is expected that conditions in the UK will remain challenging and consumer confidence will remain fragile," it added saying it believed "significant investment and time" were needed to "re-invigorate Clapham House's businesses".

Clapham raised £2.2m from issuing extra shares earlier this year, but Nando's said that while this had allowed a "selective" expansion of GBK, it would have struggled to get the further funding needed "during a time of unpredictability in the UK economy".

The deal was announced as it emerged the Ha Ha Bar brand was to disappear after the 22-strong chain was sold to pub operator Mitchell & Butlers for £19.5m.

M&B plans to convert outlets to its existing brands, including All Bar One and Browns.

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