Pizza Hut in trouble - thousands of jobs at risk as restaurant chain enters rescue talks
Pizza Hut branches and thousands of jobs are at risk after the restaurant chain started restructuring talks, it has been reported.
According to according to Sky News, Pizza Hut Restaurants is reported to have hired advisors at Alvarez & Marsal to explore the possibility of an insolvency agreement that could entail significant job cuts.
Pizza Hut's 244 restaurants in the UK are all under threat of closure - and while a final decision has yet to be taken by the chain but, a Company Voluntary Arrangement (CVA) is "a distinct possibility".
A CVA allows a company with debt problems or that is insolvent to reach a voluntary agreement with its business creditors regarding repayment of all, or part of its corporate debts over an agreed period of time.
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In a statement, a spokesman said: "Despite government support, and entering lockdown from a place of strength, the cost of lockdown combined with reduced trading levels has had a substantial impact on the whole restaurant sector.
"Along with many other businesses, we are looking at ways to minimise that financial impact, while continuing to trade as usual.
"Whether this will require financial restructuring in the form of a CVA or otherwise is as yet undecided."
The spokesman added that Pizza Hut employed 5,700 people in the UK.
Pizza Hut Restaurants is a separately owned entity to the brand's UK delivery arm, Pizza Hut Delivery, which trades from a further 380 outlets.
Neil Manhas, General Manager of Pizza Hut Delivery, said: “Pizza Hut Restaurants is a franchisee of Pizza Hut, and as such, operates as an independent legal and business entity. Pizza Hut’s delivery business of 380 stores is not included in or related to this possible restructure.
"Pizza Hut Delivery was designated an essential service during lockdown and continued to operate, successfully feeding the nation during these difficult times.
"We’ve seen strong momentum coming out of lockdown, particularly following investment in our digital and technology platforms.”