Jamie Oliver has revealed that his restaurant chain was hours from bankruptcy before he rescued it by injecting nearly £13m of his own money into the business.
The celebrity chef and entrepreneur said he still did not fully understand why Jamie’s Italian ran into financial trouble and came close to collapse in September last year.
He has since been forced to shut 12 of the chain’s 37 restaurants and make about 600 staff redundant, in an attempt to save the rest of the operation.
“We had simply run out of cash,” Oliver, 43, said in an interview with the Financial Times.
“And we hadn’t expected it. That is just not normal, in any business. You have quarterly meetings. You do board meetings. People supposed to manage that stuff should manage that stuff.”
Oliver got his big break when a visiting TV crew spotted him while he was working at the River Cafe in Hammersmith, leading to his own show The Naked Chef.
Since then he has built a TV, publishing and restaurant empire – the Jamie Oliver Group. He amassed a net worth £150m in 2017, according to the Sunday Times Rich List.
Oliver said he was forced to inject £7.5m of this wealth into the ailing Jamie’s Italian, supplemented by a further £5.2m in the months that followed.
“I had two hours to put money in and save it or the whole thing would go to shit that day or the next day,” he said. “It was as bad as that and as dramatic as that.”
The rescue plans also required £37m in loans from HSBC, as well as subsidies from other parts of Oliver’s businesses, among them Jamie Oliver Holdings, which oversees his publishing and media activity.
But more than 10 months after the chain flirted with bankruptcy, the chef said he was still unclear on why it ran into difficulty.
“I honestly don’t know [what happened],” he said. “We’re still trying to work it out, but I think that the senior management we had in place were trying to manage what they would call the perfect storm: rents, rates, the high street declining, food costs, Brexit, increase in the minimum wage. There was a lot going on.”
The rescue of Jamie’s Italian was effected via a company voluntary arrangement (CVA), which allowed for the closure of stores, a move Oliver insisted was necessary to save the remainder of the chain and 1,600 jobs.
He also had to pursue a controversial “pre-pack” arrangement to save one of his two Barbecoa steak restaurants by hiving it off into a new company with no responsibility for the original business’ debts.
The group has said that suppliers initially left out of pocket have since been repaid.
Oliver defended the business decisions taken by Paul Hunt, his brother-in-law and the chief executive of Jamie Oliver Group since 2014, who instigated a restructuring effort that was followed by allegations by former staff about a “bullying” style.
He said: “Do you know why I chose him? Because he’s many things. But he’s honest, and he’s fair. I absolutely trust him.
“His job was to come in and clean up. He has done the hardest and most fabulous job. I’m not saying that because he’s my brother-in-law. I’m saying it because it’s a fact.”