Palace Pier boss Luke Johnson has sold his stake in the Small Batch Coffee business to the Department for Coffee and Social Affairs (DoCaSA).
The rapidly expanding DoCaSA also recently bought Baker and Spice from Patisserie Holdings, another business that Mr Johnson has sold.
Patisserie Holdings was the parent company of the Patisserie Valerie cake shop chain and Mr Johnson’s exit followed the discovery of a financial black hole in the company’s accounts.
He called in the police to investigate a suspected fraud which may have cost up to £40 million as well as the jobs of hundreds of staff.
The East Street, Brighton, branch was one of those to close as the affair unravelled although the Hove branch, in Western Road, is still trading under new ownership.
DoCaSA, which mostly has branches in London and Chicago, has installed its own team of directors at Small Batch.
The Brighton coffee shop chain and coffee roasting firm’s founder Alan Tomlins has left the board.
Mr Tomlins, 36, set up the business 12 years ago, less than two years after graduating from Sussex University.
With the backing of Hove entrepreneur Nigel Lambe, Small Batch began to expand.
It now has seven branches in Brighton, Hove and Worthing and a roastery on the seafront in Portslade.