Orchid Group denies reports of looming administration
Orchid Group, the managed pub operator backed by private equity group GI Partners (GIP), has claimed reports that it is on the verge of going into administration are unfounded.
Seeking to clarify what it described as a "rather confusing article" which appeared in The Times business section yesterday, the group said it had the "full support and commitment" of its major shareholder - GIP - and its financial investors.
The Times article said Orchid's bank, HBoS, had called in a team of experts from PricewaterhouseCoopers (PwC) to look at a financial restructuring of the business and with advice on a move into administration "should this become necessary".
However Orchid moved quickly to allay fears it was about to go under.
In a statement the group said: "The original financial structure was right for a business of 300 pubs.
"In the immediate future Orchid has aggressive plans to acquire a substantial number of distressed businesses in the UK. This requires a flexible financial approach.
"As such, Orchid is working closely with PWC to create a structure which will enable it to lead an aggressive strategy of consolidation.
"This has the full support and commitment of Orchid's major shareholder (GI Partners) and its financial investors," it said.
The group stressed it had "never breached its financial covenants" and claimed it would be "at the forefront of an anticipated market consolidation" in 2009.
