Pizza Express to close restaurants after reaching deal with creditors
SEVERAL Pizza Express restaurants in the North East will close after restructuring plans were approved.
The restaurant chain had put forward plans to bring down the shutters on 73 restaurants across the UK, putting 1,100 jobs in jeopardy, as part of a Company Voluntary Arrangement (CVA).
That CVA has now been approved by creditors, with 89% of them voting for the restructuring deal, which will also see it secure rent reductions.
It needed a minimum of 75% of creditors to vote in favour of the deal to give it the green light.
Last month, Pizza Express said the slump in revenue caused by the enforced closure of all restaurants during the pandemic, the cost of re-opening, and the UK’s uncertain economic future meant its rental costs were no longer sustainable.
The closures include its sites at Newcastle’s Dean Street, Darlington, Gosforth and Dalton Park.
The Eldon Square, Gateshead Metrocentre, Durham and Jesmond restaurants, however, will remain open.
It is the latest in a raft of chains, including Zizzi-owner Azzurri Group, Byron Burger, and Frankie & Benny’s owner The Restaurant Group, to shut sites after being hit by the lockdown.
Pizza Express said it currently has 355 restaurants open in the UK, with more than 30 due to re-open in the coming weeks. The restructuring will also see a significant deleveraging on the group’s external debt, reducing it from £735m to £319m.
Around £144m of new funds will be pumped into the business to drive future growth.
In a statement, Pizza Express said: “The successful vote unlocks the company’s ability to actively address the challenges brought by Covid-19, securing over 9,000 jobs in the UK.
“The directors of Pizza Express thank its creditors for their support during this period and look forward to ongoing partnership as the hospitality industry recovers to growth.”
The company, which is majorityowned by Chinese firm Hony Capital, also confirmed last month that it had hired advisers from Lazard to lead a sale process for the business.