First Leisure, the second largest nightclub operator in the UK, currently operates 28 nightclubs across England, Scotland and Wales. Created as a management buy-out from First Leisure Corporation Plc in 2000, the Group successfully disposed of its 'Brannigans' pub chain in the same year, leaving it to focus on its nightclub operations. The difficult trading environment was exacerbated by substantial property lease liabilities reverting back to the Group, following the failure of 'Brannigans' in 2002 and more recently 'Springwood', in February 2004.
Recognizing the necessity to address these underlying issues, the board had made considerable progress over recent months towards restructuring the business, but was unable to secure the support of these key creditors. In the absence of this support, the directors had no alternative but to seek the protection of a formal insolvency procedure.
Simon Bower, one of the appointed receivers, commented: "First Leisure is the latest casualty of the decline in the nightclub sector. The Group has, however, a core business that is essentially sound, around which management have developed sensible plans for the future. Our key objectives are to preserve the business and secure the employment of the 1,600 employees. We will be working with management and staff to ensure its business as usual."
(Lee Baldock)
