Pizza Express prepares to cut a slice off its debt pile

PIZZA Express is ‘highly likely’ to launch a restructuring of its giant debt pile, despite organising a £70 million loan last month.

Credit ratings agency Standard & Poor’s said the latest measure was agreed ahead of deadlines for two smaller loans due in August. That was ‘an additional step toward a comprehensive restructuring’ of more than £1 billion debt.

Pizza Express is due to repay £465million to bondholders next year and an additional £200million in 2022.

S&P said the business now faces ‘additional hurdles’ turning its fortunes around ‘amid an extremely challenging competitive environment exacerbated by the Covid-19 pandemic’.

The 470-outlet Italian dining chain is owned by Beijing-based private equity firm Hony Capital, which has about £10billion under management, according to its website. Hony is owned by Chinese conglomerate Legend, whose subsidiaries include technology firm Lenovo.

S&P rates Pizza Express corporate debt as ‘CC’, which it defines as having ‘extremely weak financial security characteristics and is likely not to meet some of its financial commitments’.

Pizza Express closed its outlets seven weeks ago alongside bars, pubs and other restaurants after being told to do so by the Government. Several days later, it decided to close its doors for takeaway and delivery customers.

A statement on its website reads: ‘We’ll open our pizzerias as soon as it is safe to do so and in line with the latest government advice.’ Pizza Express declined to comment.