Patisserie Valerie was 'three hours' from end

Patisserie Valerie bosses have faced down claims they had held "a gun to the heads" of investors over its crisis fundraising last month.

An emergency general meeting of Patisserie Holdings shareholders, which voted on the terms of £20m in new loans by chairman Luke Johnson, was told by him that the firm was just "three hours" away from going bankrupt when the plan was enacted.

"Quite a few companies in our situation aren't saved, they go into administration," he said.

But Mr Johnson and other members of the management team, including chief executive Paul May, were told by some attending the meeting that the terms of the loans dilute their current stakes in the company as it involved the sale of new shares at a discounted price to pay him back.

Paul May, chief executive of Patisserie Holdings, and Luke Johnson executive chairman
Image: Paul May, chief executive of Patisserie Holdings, and Luke Johnson executive chairman

One said: "Why should the new shareholders benefit from buying shares at a discount?".

Patisserie Holdings announced its rescue plan almost three weeks ago after the discovery of "potentially fraudulent accounting irregularities".


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The company's finance director, Chris Marsh, was arrested on suspicion of fraud and later released.

He has since left the company.

The firm, which employs almost 2,500 staff at 200 shops, said Mr Johnson had agreed to provide the new loans pending the issue of new shares, which aimed to raise £15m.

Patisserie Valerie
Image: A Patisserie Valerie store

The entrepreneur, under the terms of his bailout, is due to get £10m in loans back once the issue of new shares is completed.

Despite evident anger at the meeting, existing shareholders overwhelmingly supported the rescue.

Mr Johnson had warned them that if the fresh funds were not approved "the company risks going into administration".

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He said he and Mr May had also made personal commitments to reduce involvement in other businesses to focus on recovery at Patisserie Holdings.

Trading in the company's shares remain suspended.

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