Stalled progress at SFI sparks potential sale

The troubled SFI Group has appointed Kroll as corporate advisor as it weighs up sale or restructuring as possible routes to survival.

The move comes as evidence emerges of a clash in strategies between executive chairman Stuart Lawson and the financial backers of SFI.

Kroll Corporate Finance has been called in by the board to help decide whether SFI should be sold or seek another refinancing package to bolster its recovery.

Mr Lawson, who was brought in to turn SFI around, said: "I know what opportunities there are for the group, others have a different view." He confirmed that SFI, which operates the Slug & Lettuce, Litten Tree and Bar Med high street chains, could well be sold or fall into the hands of venture capitalists.

Mr Lawson (pictured)​ helped stem the decline in sales at the group, reducing pre-tax losses from £110m in 2003 to £25.4m in the year to May 2004, partially through trimming the estate from 183 to 150 bars in a drive towards profitability.

The Slug & Lettuce brand has turned over a profit, up 6 per cent to June last year, but sales at both the Litten Tree and Bar Med concepts continued to fall, down 2 per cent. Overall performance was 2 per cent up for the group over the financial year ending May 2004, though the period through Christmas was thought to be disappointing.

"Whatever happens a lot of things I set out to achieve have been done," Said Mr Lawson. Referring to a possible date for the outcome of Kroll's strategic report, he said: "It is not a complicated business but there is no timetable for a decision."

In addition, SFI ongoing court-case against former auditor Horwath Clark Whitehall over an alleged £60m accounting black hole continues.