THE boss of beleaguered cake chain Patisserie Valerie has stepped down as the company led by the owner of Brighton Pier installs a new CEO to lead its recovery.

Paul May’s departure comes just over a month after the company found a black hole in its accounts and was forced to raise emergency funds to stay afloat.

His role will be taken up by Stephen Francis, who was recently CEO of pork producer Tulip, where he led a rapid return from significant losses.

Mr Francis’s experience also includes transforming Danwood Group as CEO, as well as working on the turnarounds of Vion Food Group and Vita Group.

Chairman Luke Johnson, who loaned the company £20 million to save it from collapse in October, said Mr Francis would assist with a “revival” of the business.

“I am delighted to welcome Steve Francis as new CEO at Patisserie Holdings PLC,” he said.

“He has a strong track record of restoring value in turnaround situations, especially in the food industry, and the board looks forward to working with him in the revival of the business.”

Mr May and Mr Johnson both faced criticism at a meeting of Patisserie shareholders in early November.

Investors took aim at £15 million emergency fundraising, which they said would dilute their stakes in the company.

The future of the company was first thrown into doubt after it uncovered fraudulent activity around its financial accounts and was served a wind-up order by the taxman over £1.14 million owed to HM Revenue and Customs.

The group’s finance director Chris Marsh was arrested on suspicion of fraud last month, but was later released. He has since left the group.

Luke Johnson is the chairman and largest shareholder in Patisserie Holdings with a 37 per cent stake – reported to have been worth more than £160 million.

The cake shop and continental tea room has more than 200 stores including East Street, Brighton, Western Road, Hove, and Terminus Road, Eastbourne.

Mr Johnson pledged up to £20 million in new loans in order to keep the chain’s parent company Patisserie Holdings afloat after a wind-up order was issued against it by the taxman.

The company also plans to raise as much as £15 million through the issue of new shares.

Funds raised through the share placement will be used to pay back around half the money loaned by Mr Johnson, as well as to meet outstanding liabilities including the £1.14 million bill owed to HM Revenue & Customs.

Mr Johnson said at the time: “We are all deeply concerned about this news and the potential impact on the business.

“We are determined to understand the full details of what has happened and will communicate these to investors and stakeholders as soon as possible.”

Last May he said that Patisserie Valerie had “a strong balance sheet.”