Prezzo prepares for court clash with landlords
Prezzo is preparing to face its landlords in court after the recent announcement that it will be closing a third of its restuarants, Sky News has reported.
Citing the rising costs of food and energy, the Italian restaurant chain will close 46 loss-making sites, putting the jobs of 810 members of staff at risk.
Prezzo said the cost of its utility bills had more than doubled during the past year, while the prices of dough balls, pizza sauce, mozzarella, and spaghetti had also spiked.
The restaurant chain previously went into administration in late 2020 before being purchased by private equity firm Cain International.
City sources told Sky News that Prezzo intends to use a formal restructuring plan to force through the closures.
The chain has reportedly written to the landlords of its restaurant estate, comprising of 143 sites, notifying them of its legal process through which it intends to shut its unprofitable restaurants.
The landlords will be able to vote at a hearing on May 22, although the plan is likely to be approved as Cain International are Prezzo’s largest creditor, according to a City insider.
Last week, Prezzo said that “the post-COVID recovery has proved harder than we had hoped”.
Dean Challenger, chief executive, said: “The last three years have been some of the hardest times I have ever seen for the high street”.
“The reality is that the cost-of-living crisis, the changing face of the high street and soaring inflation has made it impossible to keep all our restaurants operating profitably,” he added.