Coconut Tree Restaurant Group Rescued from Administration, Safeguarding Over 150 Jobs

A rescue deal has been completed for The Coconut Tree restaurant group, with the business acquired from administration by MPS Hospitality Limited, an entity associated with two of the company’s original founders.

The transaction encompasses the full estate of seven Sri Lankan dining establishments operated under The Coconut Tree brand, with locations spanning Bristol, Bath, Oxford, Reading and Cheltenham. The acquisition preserves employment for more than 150 staff members across the portfolio.

The group’s entry into administration was confirmed on 6 November, with insolvency practitioners Mark Boughey and Rebecca Dacre of Forvis Mazars appointed to manage proceedings. The administration followed difficulties stemming from a failed Company Voluntary Arrangement (CVA) during the summer months, which had placed the business at risk of liquidation.

Commenting on the completion of the sale, Mr Boughey highlighted the challenging operating environment facing the sector. He noted that restaurant operators are contending with elevated operational costs, shifting consumer spending patterns and broader economic pressures that have impacted trading performance.

“We are satisfied to have delivered a constructive resolution for both the workforce and creditors of The Coconut Tree,” Mr Boughey stated. He emphasised that the transaction with MPS Hospitality Limited ensures job security for the staff complement while the administrators worked to achieve optimal returns for creditor groups.

Corporate records indicate that MPS Hospitality Limited is under the direction of Shamil Tiranjan Fernando and Praveen Cliford Demitrius Fernando Thangiah. The pair were among the five co-founders who established The Coconut Tree in 2016, alongside Mithra Fernando, Rashintha Rodrigo and Dhanushka Fernando.

The rescue represents the latest example of hospitality businesses seeking restructuring solutions amid an increasingly difficult trading climate for the casual dining sector.