Fast-food chain Leon is set to close a number of restaurants and cut jobs after entering administration, just weeks after being bought back by its co-founder John Vincent in a deal reported to be worth between £30 million and £50 million.
The business has applied for an administration order to enable the formulation of a Company Voluntary Arrangement (CVA), which it said is intended to accelerate a wider restructuring of the group. Leon’s immediate priority will be to reduce the number of loss-making sites as it attempts to stabilise the business and return it to profitability.
Vincent reacquired Leon last month from Asda, which had bought the chain in 2021 as part of the Issa brothers’ EG Group empire. That acquisition valued Leon at about £100 million, significantly higher than the price paid in the recent buyback.
In a statement, Leon said the business has been hit hard by changing work patterns since the pandemic, alongside rising taxes and cost inflation, pressures that have affected much of the hospitality sector. The company added that while Vincent believes Leon drifted from its original values under previous ownership, he recognises the challenges faced by Asda and EG as operators.
John Vincent said that Leon had no longer fitted Asda’s strategic priorities and that the problems facing the chain were shared widely across the industry. He pointed to depressed footfall, hybrid working and what he described as increasingly unsustainable tax burdens as key drivers of losses across casual dining.
Leon will now spend the coming weeks in discussions with landlords, supported by restructuring advisers Quantuma, to agree proposals for the future of the estate. The aim, the company said, is to emerge from administration as a smaller, leaner business that can more easily return to its founding principles.
All Leon restaurants will continue to trade as normal during the process and the group’s grocery arm will not be affected by the CVA. The company has not confirmed how many sites will close or how many roles will be lost.
Where closures do occur, Leon said it would first seek to redeploy staff to other restaurants. Employees who cannot be relocated within a reasonable commuting distance will receive redundancy payments. In addition, the chain has struck an agreement with Pret A Manger that will allow affected staff to apply for roles through a dedicated recruitment channel.
Vincent also used the announcement to call for a review of what he sees as an excessive tax burden on hospitality. He said that for every pound spent by customers, around 36p goes to the government, leaving businesses with little margin to absorb rising costs.
Leon currently operates 71 restaurants, including 44 owned sites and 22 franchised locations. Before its sale by Asda, the chain had already cut hundreds of jobs, reducing headcount by 17 per cent in 2024 as it sought to curb losses. Its most recent accounts showed revenues falling to £62.5 million, alongside losses of £8.4 million, an improvement on the £12.5 million loss reported the previous year.
Founded in 2004 by Vincent, Henry Dimbleby and Allegra McEvedy, Leon is now hoping that a period of restructuring will allow it to rebuild and return to growth once again.
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Leon to close sites and cut jobs as fast-food chain enters administration