Gaucho Grill shares soar on bid talk

Gaucho Grill outlets were prevented from serving Argentine beef

Shares in the Gaucho Grill restaurant chain have soared by 50% after the company revealed it had become a takeover target.

The firm, whose directors include celebrity fund manager Nicola Horlick, said it had received an offer of 20p per share.

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The announcement sent Gaucho Grill stock, which opened on Tuesday at 12p, to 18p in afternoon trade.

The firm, the target last year of a failed management buyout attempt headed by chairman Zeev Godik, declined to reveal the identity of the latest bidder.

Disease fears

The offer follows a troubled period for Gaucho Grill, whose other directors include Leonard Lewis, founder of the River Island clothing retailer.

In view of the continuing economic uncertainty, the company has decided to suspend its expansion programme

Zeev Godik, chairman

Fears over the foot-and-mouth and BSE livestock diseases saw Gaucho Grill's Swiss outlets prevented from serving Argentine beef in 2000, with UK and Dutch bans following early last year.

The restaurants are marketed as selling "the ultimate steak from Argentina".

The firm also suffered from the travel slump stemming from the 11 September terror attacks on the US.

The attacks cut business and tourist customers, "particularly in central London and Zurich, where we have our largest restaurants", Mr Godik said in a separate statement on Tuesday, revealing the firm made a pre-tax loss of £1.4m last year.

The company made a profit of £1.9m in 2000.

'Economic uncertainty'

The downturn has forced Gaucho Grill, which also runs Down Mexico Way bars in London, Zurich and the Netherlands, to shelve a development programme, Mr Godik said.

"In view of the continuing economic and general uncertainty, the company has decided to suspend its expansion programme until market conditions justify such a commitment," he said.

Gaucho Grill in January moved its listing from the London Stock Exchange to the Aim stock market which specialises in smaller firms.