Patisserie Valerie: court dismisses winding-up case over £1m tax bill
Patisserie Holdings says it is investigating share bonuses that were cashed in this year
The owner of Patisserie Valerie has fought off a winding-up petition against its principal trading subsidiary as the cake shop and cafe group continues to battle for survival.
Separately, Patisserie Holdings, which has more than 200 cafes and nearly 3,000 staff, said it was investigating share bonuses that were cashed in this year by both its chief executive and its finance director.
The company’s statement did not suggest that any share options had been wrongly allocated or exercised, only that it was “seeking to understand” why the grant of options relating to 2015 and 2016 had not been “appropriately disclosed and accounted for”.
The Aim-listed company called in forensic accountants from PricewaterhouseCoopers to trawl through its accounts after saying that “fraudulent activity” was uncovered that left the business close to collapse earlier this month.
Chris Marsh, the group’s finance director and company secretary, who joined the company in 2006, has since been arrested and bailed. Hertfordshire police, who declined to name the individual, said a 44-year-old man from St Albans, where Marsh lives, had been arrested on suspicion of fraud by false representation.
The Serious Fraud Office has confirmed that it has opened a criminal investigation into an individual but has not given further information.
The group’s multi-millionaire chairman, Luke Johnson, was forced to use £20m of his own money to keep Patisserie Holdings in business after finding that it was nearly £10m in debt instead of having £28m in the bank, as it had last reported.
Directors have said they were unaware until 10 October that Patisserie Holdings’ main trading subsidiary, Stonebeach, faced a winding-up petition from HMRC over a £1m unpaid tax bill.
Only Marsh and Patisserie Holdings’ chief executive, Paul May, were on the board of Stonebeach until 11 October, when documents filed at Companies House this week show that Luke Johnson joined.
The winding up petition was filed on 14 September but the directors said they were unaware of its existence until earlier this month.
The case was due to be heard on 31 October, but on Wednesday morning, Patisserie Holdings told the stock market that the winding-up petition had been dismissed in the high court.
In a separate statement, the company said Marsh had been granted 666,666 bonus shares in 2014, 2015 and 2016. May was granted 1m shares in each of those years. Shares granted in the first two years have been exercised and sold this year.
The company’s latest annual report gives the correct information relating to share options granted in 2014, but says only 320,000 share options were granted to executives in both 2015 and 2016.
Over the period, Marsh made a profit of nearly £2m from the share sales, while May made more than £2.6m.