Patisserie Valerie black hole grows to £94m

KPMG, the administrators for scandalhit café chain Patisserie Valerie, has revealed that its forensic accountants found a £94m black hole, more than double the previous £40m estimate.

In its latest report the accountancy firm said Patisserie Valerie, which collapsed into administration in January, falsely claimed to have £54m in cash and that its assets were valued £23m higher than they were.

It said: “The group’s majority shareholder, Mr Luke Johnson, provided rescue funding of £20m in October 2018, to fund the group’s trading operations in the short term.

“Further analysis by the directors and forensic accountants in the following months led the board to understand that the consolidated accounts were overstated by approximately £94m.”

KPMG has advised the company to “consider whether there may be sufficient grounds to establish potential legal claims against a number of parties”, including Patisserie Valerie’s auditors Grant Thornton. But it also revealed that it “would not be appropriate” to bring a legal claim against Grant Thornton, as it also acts as an auditor to KPMG.

It said that the creditors’ committee will need to decide whether it wishes to appoint an additional administrator to launch action.

The collapse of Patisserie Valerie affected more than 3,000 employees across the UK after last-ditch talks to secure fresh funding from banks HSBC and Barclays fell apart.

Founded in 1926 by Esther van Gyseghem, who became known as Madame Valerie, the bakery chain, which was once considered the darling of the coffee sector, was valued at £450m before its collapse.