First Leisure may set up its own restaurant chain

First Leisure, the bars-to-bowling group chaired by ex-Channel 4 boss Michael Grade, is considering setting up its own restaurant chain. Mr Grade is understood to have looked at a number of sites around London, including several in Covent Garden, according to industry sources.

If First Leisure can find the right sites it is likely to create a string of branded restaurants. It could also consider buying an existing chain.

Expanding into restaurants would be Mr Grade's first new venture since he joined First Leisure last June. He has already undertaken a fundamental review of the company, putting the troubled bingo division on the market and identifying a number of other under-performing businesses to be sold.

Mr Grade is now exploring a number of other possibilities in the leisure industry, in an effort to restore the City's faith in the troubled group. First Leisure's shares have fallen from a peak of 399p in 1996 to 297.5p and have under-performed the market by 40 per cent over the last year. He is keen to create another division at First Leisure to complement the nightclubs, bowling, and health and fitness businesses that he has pledged to expand.