Creditors of chain restaurant group Pizza Express have approved the restaurant chain’s restructure.
The company said the creditors had voted for the company voluntary arrangement (CVA) that will lead to the closure of 73 restaurants and the loss of 1100 jobs.
Pizza Express said: “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 CVA is a key component of a wider financial restructuring which will strengthen the business for the future.
The chain said 89% of its creditors voted in support of the CVA 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 reopening, and the UK’s uncertain economic future meant its rental costs were no longer sustainable.
Zoe Bowley, UK & Ireland Managing Director, commented: “The announcement of the CVA proposal today follows a period of constructive dialogue with the British Property Federation and a broad range of our landlords.
“We have taken onboard their feedback and accommodated their requests as far as possible.
“Unfortunately, the impact of the global pandemic has meant that we have had to make some incredibly tough decisions to safeguard PizzaExpress for the long term. Today we have confirmed that 73 of our pizzerias are proposed to close permanently. In most cases, there is another PizzaExpress nearby, either already open or reopening soon, to welcome our customers.
“Our focus is on our people whose jobs are impacted and we will be doing everything we can either to redeploy them or to support them in finding roles elsewhere. Hard as this process is, it will protect the jobs of over 9,000 of our colleagues and provide a strong footing for PizzaExpress to meet future challenges and opportunities.”
Melanie Leech, Chief Executive, British Property Federation (BPF), commented: “These situations are never easy, particularly now for the retail, hospitality and leisure businesses on our high streets at the sharp end of the COVID-19 pandemic. Property owners, however, need to take into consideration the impact on their investors, including the millions of people whose savings and pensions are invested in commercial property, as they vote on any CVA proposal.
“PizzaExpress and Deloitte engaged with the BPF before launching this CVA proposal. This has provided us an opportunity to improve understanding of property owners’ interests and concerns, but ultimately it will be for individual property owners to decide how they will vote on the CVA.”