Deltic, the UK’s largest nightclub operator, has told landlords that the firm faces closure if a sale is not agreed, according to Sky News.
Closure of the company, which owns the Oceana and Pryzm club brands, would reportedly put over 1,000 jobs across 52 venues in the UK at risk.
Peter Marks, chief executive at Deltic Group, wrote in a letter to property-owners, obtained by Sky News, that “without a successful sale, the business will have no option but to be closed”.
He added that a rent-free agreement is necessary due to the fact that no serious buyers will be interested in the properties “without the knowledge that long-term occupation of the property can be secured”.
While no formal bid for the company has been made as of yet, the private equity firm Greybull Capital is reportedly among those interested in acquiring Delta.
However, without “clarity” in relation to a date nightclubs will be allowed to reopen, investors will need the “support of the landlord group” for an indefinite period, according to Sky News.
Marks said: “The management team of Deltic Group firmly believe that when they are allowed to open they will once again have a viable long term business. In the interim any investor will have to fund substantial holding costs to maintain the staff and meet statutory obligation until the clubs can be reopened.
“Whilst bidders are willing to invest without clarity on an opening date, they require the support of the landlord group through the closure period.”
Deltic has already commenced a number of redundancies as part of cost-cutting measures, while rival late-night venue operator, Revolution Bars Group, launched a CVA proposal last month to reduce the size of its estate.
Catering Today has contacted Deltic Group for further comments.