The Courier & Advertiser (Perth and Perthshire Edition)
Patisserie Valerie seals rescue deal
Patisserie Valerie chairman Luke Johnson has faced down sharp criticism from shareholders as the cake chain sought backing for a rescue plan.
Mr Johnson was forced to loan £20 million to the company to prevent it going bust, while investors poured in another £15m through fundraising.
He told investors at a meeting yesterday the emergency fundraising in October had been enacted when the firm was just “three hours” away from going bankrupt.
“Quite a few companies in our situation aren’t saved, they go into administration,” he said.
A total of 99.68% of votes cast were in favour of the emergency rights issue.
The final votes were counted after an emergency general meeting for Patisserie Holdings, the AIM-listed parent of the cake chain.
Mr Johnson and other members of the management team, including chief executive Paul May, faced fierce criticism from investors over the company’s financial troubles.
Shareholders took aim at the emergency fundraising, which they said would dilute their current stakes in the company.
One investor accused the management of “holding a gun to our heads”.
Mr Johnson defended the rescue plan and warned shareholders that if the fresh funds were not approved “the company risks going into administration”.
He added that he had made a personal commitment to reduce his involvement in other businesses and focus on Patisserie Holdings.
Mr Johnson is the chairman of Gail’s Bakery parent Bread Holdings and Brighton Pier Group, and backs a number of other ventures through his investment vehicle Risk Capital Partners.
The future of Patisserie Holdings was first thrown into question last month after it uncovered fraudulent activity around its financial accounts and was served a wind-up order by the taxman over £1.14 million owed to HMRC.
Finance director Chris Marsh was arrested on suspicion of fraud last month. He has since left the group.