IF THE Asda-buying Issa brothers have really spent £100 million buying the Leon fast food chain, they can’t be as financially savvy as we thought.
I’m the biggest fan of Leon (best chips in town), but £100 million for 42 company-owned outlets?
For a business fresh out of a CVA?
I’m told £13 million of the sum consists of debt, and the boys see Leon as a wunderbrand in the making, but even so.
Still, this being a sale from one private entity to another, perhaps it’s none of our business.
But one aspect we should ponder is this: how many über-ethical firms like Leon will go under, sell up or compromise standards under the strain of Covid?
Leon founder John Vincent was advocating high employment standards and healthy, affordable meals before “ESG” was invented.
How wholeheartedly will the petrol forecourt tycoons bear arms for his cause?
Will they retain the free kung fu lessons he made available to staff at his Southwark HQ? Will they keep up his free wellness festivals for employees, featuring yoga, massages, and the like?
Before Covid, low interest rates and a healthy economy allowed ethical businesses to survive and thrive that otherwise might have struggled. Covid will shake many of them out.
But on the flipside, there is a wall of money looking to back ESG assets which could provide many a lifeline to tide them over.
Green bonds are these days priced considerably cheaper for the borrower than conventional ones. While currently the preserve of big companies, it’s easy to foresee a clever bank deliberately setting up ethical funds specifically aimed at helping good-hearted SMEs.
That investment cash is there because people want to invest and spend their money ethically.
Covid will cause casualties, but the long-term winds are still blowing in ethical businesses’ favour.