It pointed to the fact that the trustee of TGI Fridays' corporate securitisation has terminated it as the manager of TGIF Funding, which is the company subject to the corporate securitisation.

TGIF Funding holds legal title to the franchise agreement royalties and other various fees and revenue from intellectual property of the TGI Fridays business.

"While TGI Fridays remains the owner of the residual interest in TGI Funding, the termination compromises the control over the royalty stream of TGI Fridays and also potentially impairs the future revenue of the business," Hostmore explained.

"The predictable and highly cash generative royalty stream of TGI Fridays was the primary attractive feature for the group in pursuing the acquisition."

At 0920 BST, the shares were down 90% at 0.88p.