Pizza Hut creditors prepare to vote on restaurant closure plan

PA

Pizza Hut will be the latest restaurant chain to attempt to push through site closures when its creditors and landlords vote on restructuring plans next week.

On Monday, the UK arm of the pizza chain will close the vote on its Company Voluntary Arrangement (CVA) restructuring process.

The deal would result the permanent closure of 29 of Pizza Hut UK’s 244 restaurants, with around 450 jobs at risk, if it is passed.

Earlier this month, it said it put forward the proposals as “sales are not expected to fully bounce back until well into 2021” despite a quick and safe reopening of sites.

The measures aim to protect about 5,000 jobs across its remaining restaurants as well as the “longevity” of the business, it said.

Creditors are expected to vote in favour of the move, which will also secure the company significant rent cuts.

Retail and hospitality landlords have come under immense pressure in recent months, following a raft of high profile CVAs while some chains have also held off quarterly rent payments.

However, landlords and creditors have continued to vote favourably on CVAs, preferring to secure agreements based on lower rents than risk pushing retailers or restaurant chains towards more severe insolvency processes by rejecting proposals.

Rival Pizza Express confirmed this month that it will shut 73 restaurants with 1,100 job losses after its own CVA deal was approved by creditors.

Fellow dining chains Wahaca, Wasabi, Byron and Yo! Sushi have also seen similar restructuring deals waved through during the pandemic.

Earlier in September, a Pizza Hut spokeswoman said: “We are committed to doing the right thing and, in order to secure as many jobs as possible and continue serving our communities, we are working to reach an agreement with our creditors.

“We understand this is a difficult time for everyone involved.

“We appreciate the support of our business partners and are doing everything we can to help our team members during this process, including speaking with those affected by the consultation.”

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