Two former chief executives of well-known recruitment companies have teamed up to become joint chairmen of catering recruiter Berkeley Scott and will inject £2.5m into the company, in return for a 62.6% stake.

Tony Reeves and John Bowmer, former chief executives of Hotgroup and Adecco respectively, have formed a venture called Spur Lodge.

Bowmer met Reeves when Adecco acquired Delphi, owner of Computer People. Bowmer told Recruiter: "We always said if we were free, we should do something like this together."

Berkeley Scott's chief executive, Roddy Watt, who founded the firm in 1984, is leaving the company. Reeves is acting chief until a successor is found.

Watt told Recruiter he had been "alarmed" by Spur Lodge's initial approach. However, he said he felt the transaction had been conducted professionally and it was "time to move on". Watt will be on "gardening leave" for the next six months but added: "I'm not hanging up my boots just yet."

Spur Lodge said it would use Berkeley Scott "as a vehicle for consolidation of the fragmented recruitment market, growing the business both organically and by acquisition to deliver greater shareholder value". It added: "Acquisition targets will be considered if they have strong brands, serve attractive niche recruitment sectors, and have sustainable revenues and quality candidate databases."

Reeves said: "We've been looking for some time for an excellent foundation to build a successful recruitment firm around a portfolio of premium brands, in the same multi-brand style as the Hotgroup."

Berkeley Scott reported a pre-tax loss of £0.63m for the six months to 31 March, on sales of £8.77m. The new £2.5m cash injection will be used to refinance its debt and provide additional funding for ongoing working capital needs.

Under the City Takeover code, a party acquiring more than 30% of a listed firm is normally required to make a full bid. But a meeting of Berkeley shareholders is expected to waive this requirement.