Britain's largest chain of butcher's shops was rescued from receivership yesterday when a management team bought the Dewhurst shops in a deal worth around pounds 5m.
The sale safeguards 1,000 jobs and involves 213 of the high-street Dewhurst sites, which trade under a variety of names, including Baxters, Matthews, and Cobb of Knightsbridge. However, 40 branches will close, in addition to the 10 closed in Scotland last week.
Dewhurst was placed in receivership in March, when banks refused to extend credit to its parent company, Union International. Union was part of the Vestey family empire.
Dewhurst then had around 400 shops, with sales of around pounds 100m. However, it was losing pounds 4m a year and had debts of pounds 35m. The high-street chain has been hit by fierce competition from supermarkets and hampered by a number of poorly located outlets.
The new owners, led by managing director Roger Reeson and finance director Eugene Lines, insist the butcher's shop has a place on today's high street. "We can trade very successfully alongside greengrocers or on high streets where food is sold," Mr Lines said. "The problem is where supermarkets have moved out of town and the high street has withered."
Mr Lines said Dewhurst would continue its programme of store refurbishment and increase the number of concession outlets. It already has 10 concessions in food discount stores such as Netto and hopes to increase the number to 50. He added that the stores being acquired were trading profitably on sales of around pounds 60m.
The deal is being backed by Foreign & Colonial Ventures and NatWest Markets.
In a separate deal, Asda Property Holdings paid an estimated pounds 10m for the freehold of the 213 sites that will then be leased back to Dewhurst.
The Dewhurst sale, which has taken five months to negotiate because the two sides could not agree on a price, means no more Union subsidiaries remain to be sold. British Beef, an abattoir and processing group, was sold to Irish company Kepak just a few weeks after Union collapsed.