Hexham bistro boss in leap of faith to save venture

Mr Lilley has agreed to keep the five restaurants trading at his own risk until at least Friday this week, to keep goodwill in the business while Begbies Traynor looks for a buyer.

Just over a year ago Mr Lilley was riding high with plans to quadruple the size of his business, having just acquired the prominent chain of Smollenskys and Burger Shack restaurants in central London for £6.5m.

But the slowing of the economy has hit the food and drink industry hard, the Le Frog restaurants are struggling and there are only two Smollenskys and two Burger Shack outlets operating.

Andrew Haslam, of Begbies Traynor in Newcastle, said: "One of the big issues [for Wolfteam] is the lack of money in individuals' pockets, though they have done quite a lot of special offers.

"We are dealing with Wolfteam, which has Le Frog bistros in Warrington, Wigan, St Helens, Ormskirk and Preston. We are the administrators of that company, which is trading under licence until Friday. My instructed agent Christie & Co is marketing the business with a view to selling it. It's a good business and Grill Group has put a large investment into it."

Grill Group runs a business called Shire Group, which itself has four smaller companies operating restaurants.

One of these is Wolfteam, Another is Pastiche Bistros Ltd, which itself has two subsidiaries, Barland and Maddison Bistros, which are both being liquidated by BDO Stoy Hayward in London.

The third subsidiary is Pastiche Bistro (Franchising) - again being liquidated by BDO.

It also has a business Norham House 1119, an off-the-shelf company acquired to hold Grill Group's acquisition of the Smollenskys restaurants in London.

Paul Lilley was not available for comment last night.

In September last year, Shire Group employed 450 staff and had just acquired Smollenskys . Mr Lilley was planning to open about 20 restaurants over three to four years.

Mr Lilley, former group finance director of the Noble Organisation, had raised £8.5m for the expansion and said he was confident of raising more.

He said then: "The acquisition of the Smollensky's group of restaurants is an important milestone in our buy and build strategy.

"It is great news for our North East base of operations.

"Strong management and the excellent service and discipline we have brought to our other restaurant businesses will make the established name thrive in a new era of ever increasing competition."