France’s Restaurant King Says Industry Needs Government Rescue

(Bloomberg) -- Olivier Bertrand, who owns more than 850 eateries from the Burger King chain in France to famed Parisian brasseries, wants a rescue plan for the country’s restaurant sector, one of the most hit from the coronavirus pandemic.

“We are very worried about the current situation and about what the future holds,” Bertrand told the French TV channel BFM Business in an interview on Thursday, commenting on a letter sent to President Emmanuel Macron’s government requesting an aid package.

Bertrand has built an empire since founding his closely held company, Groupe Bertrand, in 1997. Its properties include Au Pied de Cochon, the Paris spot that counted former French President Francois Mitterand among its clients, Brasserie Lipp in the chic Saint-Germain-des-Pres neighborhood, and Bofinger, right next to the Bastille. It also operates restaurants within the Palace of Versailles grounds and owns the Burger King fast-food chain in France.

France started loosening strict confinement measures this week after 55 days of lockdown. Restaurants, bars and pubs haven’t been allowed to reopen yet, although many maintained or introduced take-away services. The decision on re-opening cafes and restaurants will be made the week of May 25, depending on health conditions, the French government said today. In those cases where the virus circulation is low, cafes and restaurants could reopen on June 2.

The restaurant industry in France counts more than 1 million unemployed, and the shutdown caused a loss of 13 billion euros ($14 billion) in sales, with implications for the agriculture, animal raising and fishing sectors, Bertrand said during the interview. While partial unemployment and other government measures helped some operators, it’s not enough to help the smaller players or those restaurants that had opened very recently, all of them in big trouble today, Bertrand said.

“The whole sector is hit, the big players, the medium-sized ones and the smaller ones,” Bertrand said. “Restaurants can’t be treated differently. If they were to reopen today, there would be a general collapse.” Lowering the value-added tax to 5.5% from the current 10%, exemption from employer taxes and the extension of partial unemployment in the months to come, are measures crucial for the restaurant sector’s survival, he said.

While the French government has promised 18 billion euros to rescue the country’s tourism industry, a separate aid package is needed for the restaurant sector, Bertrand said.

Bertrand has used borrowed money to help build his empire. Burger King France has 625 million euros ($675 million) of debt across floating and fixed-rate notes, according to Bloomberg data. The firm’s secured notes due 2024 were quoted at around 95 cents on the euro on Thursday. The bonds gained in the past month after touching a record low of 72 cents on the euro in mid-March.

Burger King France said in April that the company drew on a revolving credit facility and had 100 million euros of cash before the crisis began.

 

Source: https://www.bnnbloomberg.ca/france-s-restaurant-king-says-industry-needs-government-rescue-1.1436370

 

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