Domino’s Pizza’s eight-year Italy foray ends in liquidation
Domino’s Pizza’s franchise in Italy has entered into liquidation, after a short-lived struggle to win over customers in the birthplace of pizza.
A Milan-based judge opened liquidation proceedings for Domino’s franchise partner, ePizza, last week, according to a filing with the local chamber of commerce seen by Bloomberg News.
A court-ordered liquidation could result in a recovery for creditors of 5% of their exposure, according to a draft restructuring plan seen by Bloomberg News that was submitted last year by the Milanbased firm and its financial advisers.
The last of Domino’s 29 Italian branches closed last summer, ending a foray that began in 2015 with the U.S. brand touting pizza toppings that included pineapple and barbecue chicken, an unusual take in a country more accustomed to thincrust margheritas. Over the years, the American fast-food chain’s partner borrowed heavily for ambitious plans to open 880 stores.
The pandemic, however, hobbled ePizza. Covid-related lockdowns deprived the company of 35% of its revenue from 2020, as did rising competition. Once largely bricks-and-mortar focused, Italian pizzerias ramped up their home delivery offerings through third-party services such as Deliveroo or Glovo, hurting demand for Domino’s pies.
A representative for Domino’s didn’t respond to a request for comment. A representative for ePizza couldn’t be reached for comment.
All those challenges led ePizza to fall behind on its debt payments, with talks on a potential rescue failing to bear fruit. As of May 2022, it had €19.3 million ($20.8 million) of debt, of which €5.3 million were owed to banks, according to the draft restructuring plan.
The Milan tribunal has set a hearing on ePizza’s liquidation for June 21, according to the first filing.