Private equity firms will reveal their appetite for Byron this week when first-round bids are submitted for the fast-growing burger chain that is up for sale for £100m.
Gondola Holdings, the chain's owner, which is controlled by the private equity firm Cinven, put Byron up for sale this year by hiring corporate finance advisers at DC Advisory.
Byron has only 30 restaurants, which are primarily in London, but it is expanding rapidly and is on track to deliver underlying profits of more than £10m this financial year. Based on an earnings multiple of 10, the burger chain could achieve a price tag of £100m. It is unclear which private equity firms will bid for Byron but suitors could include LDC, TA Associates, Graphite Capital, Investcorp, Phoenix Equity Partners, Equistone and Lion Capital.
Byron nearly doubled its pre-tax profits to £2.2m, on turnover of £28.6m, over the year to July 2012, according to Companies House.
Gondola also owns the Pizza Express, Zizzi and Ask chains.
Byron competes in a crowded market against chains, including Gourmet Burger Kitchen and Fine Burger Company, while the US giant Five Guys launches this year.
This chain, named after the founding Murrell family's five brothers, has more than 1,000 restaurants in North America and will open its first outlet in London this summer. Charles Dunstone, founder and chairman of Carphone Warehouse, paved the way for the UK launch of Five Guys by forming a joint venture with its parent company last year.
Meanwhile, the private equity firm Bridgepoint has emerged as the front runner to acquire Côte Brasserie, the French restaurant chain backed by the business tycoon Richard Caring, for more than £100m. Bridgepoint, which owns Pret A Manger, is thought to be in exclusive talks to buy Côte. All parties declined to comment.