Former pubs operator Paramount has said it plans to parachute new management into restaurant chain Groupe Chez Gérard, cut costs, dispose of more restaurants and rebrand others if a £15.5m takeover bid is successful.
This would probably mean that recently appointed managing director Simon Binder would lose his job, and puts a question mark over whether chairman and founder Neville Abraham would continue to be associated with the company.
However, there are strong rumours that Abraham is looking at a number of ways of preventing the company falling into the hands of Paramount, including the possibility of launching a management buyout at a higher offer.
Paramount, now operating as a "shell" company specifically for the takeover, made a formal offer last week for the owner of the Livebait, Chez Gérard and Bertorelli's brands.
It has offered shareholders 3.75 of its own shares for every single Chez Gérard share, with a cash alternative of 75p a share. The bid is £5m less than the £20.6m it offered for Groupe Chez Gérard in October last year.
Paramount said the reason it had cut the price was because it had identified a shortfall "significantly below expectations" in Groupe Chez G‚rard's projected cash-flow. If successful, Paramount intends to appoint Nick Basing, a former executive with Rank and Unilever, as chief executive.
Ian Neill, chief executive of Wagamama, has been earmarked as a non-executive director.
Basing, said Paramount, would focus on improving the group's cash-flow by "increasing restaurant profitability, reducing support office costs, some disposals and selective rebranding".
A Groupe Chez Gérard spokesman said the company was considering the offer and would make a response "in due course".
With 17 of its 23 restaurants in London, Groupe Chez Gérard has been particularly vulnerable to the slowdown in the capital's tourism market since the 11 September terror attacks. Trade has been affected by the continuing closure of the London Underground's Central Line and the new congestion charging.
Last year, the company reported losses of £3.4m but last month it posted half-year profits of £813,000 on the back of a recovery programme that has seen it dispose of five restaurants and reduce the size of its central office.