Premier Inn owner Whitbread has announced plans to shut its remaining Beefeater and Brewers Fayre restaurants in the UK and Ireland, resulting in about 3,800 job losses. The cuts represent approximately 12% of Whitbread's 30,000-strong workforce in the region. The company said consultations with affected employees would begin immediately.
Whitbread stated it expects to retain a 'significant proportion' of staff affected and would try to find them alternative roles, given it hires about 15,000 people each year. The move is part of a strategic reset after the company was hit by higher costs following the chancellor's budget, which Whitbread warned would cost it an extra £50 million this year.
The company plans to convert all remaining branded restaurants into an integrated food and beverage offer for hotel guests, unlocking the addition of more hotel rooms. Whitbread will also sell and lease back £1.5 billion of its freehold properties to fund future growth, shifting towards leasing hotels.
Whitbread has been under pressure from US activist investor Corvex, which holds a 6.05% stake and argues the company's share price undervalues its assets. The strategy means Whitbread will become a pure hotel business, seven years after selling Costa Coffee. The Beefeater brand, established in 1974, and Brewers Fayre will disappear from UK high streets.
The Unite union criticised Whitbread for not informing staff before the public announcement. Unite national officer Colenzo Jarrett-Thorpe said: 'It is disgraceful that Whitbread employees heard about the job cuts through the media. The company did not even have the decency to let its staff know first.' Unite is demanding full consultations.
Whitbread reported flat revenues for the year to 26 February compared with the previous year. Shares fell more than 3% on Thursday, and have dropped 20% in the past six months.
