British cake chain Patisserie Valerie has been bought out of administration by an Irish private equity firm, safeguarding nearly 2,000 jobs.

Dublin-based Causeway Capital Partners and the new management of the business, led by Steve Francis as chief executive, has snapped up 96 Patisserie Valerie sites including two in Ireland.

However, the deal does not include 27 sites belonging to sister brands Philpotts and Baker & Spice.

They are thought to be being sold separately to a different buyer.

The 2,000 employees currently working in the business will move to a new corporate entity with their existing employment rights and benefits honoured.

"Patisserie Valerie is heritage brand, much loved by its loyal customers," Matt Scaife from Causeway Capital said in a statement.

"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."

Founded in London’s Soho district in 1926 Patisserie Valerie, which was chaired by Luke Johnson, was put up for sale last month after collapsing following the discovery of fraudulent activity in its accounts.

Sports Direct tycoon Mike Ashley subsequently submitted a bid for the chain, but later withdrew it, complaining that he had been locked out of the process by KPMG, which is managing the administration.

The cake firm's parent company, Patisserie Holdings, has been grappling with the fallout of the accounting fraud since October.

Last month the firm said the extent of fraud meant it was unable to renew its bank loans with HSBC and Barclays and it did not have sufficient funding to continue trading, leaving it with no option but to appoint KPMG as administrator.

KPMG has already closed 70 stores, resulting in 920 redundancies.