Clapham House, the restaurant operator behind the Gourmet Burger Kitchen and Tootsies brands, was in the bid spotlight this morning after the company that owns the Nando's chicken chain lifted its stake to almost 25 per cent.

The group, which saw its shares dive last month after a profit warning, announced today that Capricorn Ventures International, an investment vehicle controlled by the Enthoven family, had raised its holding to 24.93 per cent, up from 18.4 per cent early last week.

Shares of Clapham House, which fell from 248p to 150p on the day of the profit alert, added 3.5p to 220p in early trading as investors bet that Capricorn could launch a full takeover bid.

In 2003 Capricorn teamed up with TDR Capital to acquire PizzaExpress after the chain had issued a profit warning.

At the time PizzaExpress was run by David Page, who is now chairman of Clapham House.

Capricorn, which no longer has an interest in PizzaExpress, started buying shares in Clapham House soon after its profit warning, snapping up an 11 per cent stake.

Analysts suggested that although Capricon had not ruled out the possibility of a bid, it may be building a position in the expectation of a move by a third party.

Cinven, the present owner of PizzaExpress, is known to have been eyeing the company for several months, and a number of other private equity firms are rumoured to be monitoring events.

Clapham's warning last month that profits over the next two years would be "significantly below original expectations" sent share prices across the restaurant sector tumbling.

It said that although trading in its high street restaurants, notably its Gourmet Burger chain, was holding up well, its 11 Tootsies eateries in shopping and leisure centres had suffered from a decline in footfall.

There are strong suggestions that Clapham is considering selling its 24 remaining Tootsies restaurants with a view to restarting expansion of its Gourmet Burger chain.

It said last month that it was temporarily reining in development to avoid increasing its debt burden.

Clapham's comments over future prospects have elicited a mixed reaction from rivals.

Although YO! Sushi and Tragus, the owner of Café Rouge, have insisted that trading remains robust, The Restaurant Group warned investors recently of a slowdown in the fourth quarter.

Prezzo, the AIM-listed Italian operator, added to the gloom this morning by warning the market that it had seen "some evidence of a softening in consumer spending, noticeably so in November".

It said that although it had enjoyed strong sales in the run-up to Christmas, this had not fully mitigated the impact of the previous weakness in trading together with pre-opening costs for the 14 new eateries launched in November and December.

Prezzo, which is controlled by the Kaye family and has 127 outlets, said that it now expected 2007 profits to be at the lower end of current market forecasts and added that it would take an impairment charge of about £3 millon against the value of its fixed assets.

Greg Feehely, an Altium Securities analyst, is forecastiing adjusted pre-tax profits of £10.5 million, up from £8.7 million in 2006.

Shares of Prezzo, which have fallen sharply since the Clapham House warning, were down 5.5p to 40p in mid-morning trading.

Mr Feehely said that the fall in the shares was a buying opportunity, given its attractive growth prospects and "the strategic value of the brand in a consolidating industry".

Neither Clapham or Capricorn could be reached for comment.

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