An Irish private equity fund has bought British bakery chain Patisserie Valerie out of administration.

The chain, which was founded in London in 1926, was placed under administration after fraudulent activity was uncovered in its accounts.

It was put up for sale by administrators KPMG last month.

It has now been snapped up by Irish firm Causeway Capital – which has offices in Dublin and London.

The sale was jointly funded by the firm and the businesses new management, led by CEO Steve Francis.

In a statement, Patisserie Valerie said its nearly 2,000 employees will retain their existing employment rights and benefits under the new ownership.

It will maintain 96 branches – including two in Ireland.

KPMG had already closed 70 outlets, with over 900 people being made redundant.

Matt Scaife, a partner at Causeway Capital, said: “Patisserie Valerie is heritage brand, much loved by its loyal customers.”

“This investment should mark the end of a turbulent period for customers and suppliers alike.

“We are delighted to partner with the team and look forward to helping the business return to growth.”

The investment marks Causeway Capital’s sixth completed investment from its maiden fund.

Patisseries Valerie CEO Steve Francis said: “We are delighted to welcome Causeway Capital as our partners in Patisserie Valerie, ending a disruptive period of uncertainty for the business.”

“The affection and loyalty for the brand among our customers and employees and Causeway Capital’s enthusiasm and support for the business creates for us the foundations for an exciting future.”

The investment comes after Sports Direct owner Mike Ashley claimed he had been locked out of the bidding process for the chain by KPMG.