CLOSING TIME
Patissere Valerie on the brink of collapse putting 2,500 jobs at risk
The cake shop, which has more than 200 stores across the UK, told investors it needs a huge cash boost to stay open
CAFE chain Patisserie Valerie is on the brink of collapse, putting 2,500 jobs at risk.
The cake shop, which has more than 200 stores across the UK, told investors it needs a huge cash boost to stay open.
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Its owner, Patisserie Holdings, said it has a £20million shortfall in its accounts in a shocking statement to the London Stock Exchange today.
It also said it had discovered "significant, and potentially fraudulent, accounting irregularities".
Yesterday, the chain revealed it faces liquidation after being hit with a £1.14million unpaid tax bill by HMRC.
It faces a court hearing on October 31.
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If the bill goes unpaid, HMRC could force Patisserie Valerie and the four other businesses that Patisserie Holdings runs to close in order to cover the cost of the bill.
Patisserie Holdings has today suspended its shares amid the scandal - as well as its finance boss Chris Marsh.
The majority shareholder is founder and chairman Luke Johnson, who holds a 37 per cent stake.
Patisserie Holdings said in the statement that "the board found ";a material shortfall between the reported financial status and the current financial status of the business.
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"Without an immediate injection of capital, the directors are of the view that that is no scope for the business to continue trading in its current form."
It added: "Professional advisers are assessing all options available to the business to keep it trading and will update the market in due course."
In its last results statement, the company said it had cash reserves of £28.8million.
The first Patisserie Valerie opened in Frith Street in Soho, London, in 1926.
Luke Johnson's Risk Capital Partners bought a majority stake in 2006 when it had eight stores.
It then expanded to open 206 stores in total.
Patisserie Holdings also includes four other brands: Druckers - Vienna Patisserie, Philpotts, Baker & Spice and Flour Power City.
They are also at risk of closure.
The business as a group has 2,500 employees.
The Sun has contacted Patisserie Valerie and we will update this story when we hear back.
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