James O'Brien 10am - 1pm
Pizza Express fans plead for support as firm hires advisers for crunch talks
8 October 2019, 10:25
Pizza Express fans are calling for customers to head to branches in their droves to stave off the firm's possible collapse, as it has hired financial advisers to conduct crunch talks.
The chain has hired corporate finance firm Houlihan Lokey to prepare for talks with creditors amid difficult trading conditions for casual dining chains in the UK.
Fans of the chain told people to go to restaurants to support the business. Sam Claments wrote online: "Pizza Express is, without qualification or excuse, the best restaurant in the entire world.
"It must not fold. Subsidise it. I would gladly pay a National Insurance style tax to keep it going."
Chris Samuels said: “Everybody who can should make an effort to eat at Pizza Express this week. Our high streets will be worse without them”
David Grunwald wrote: “I'd be devastated if Pizza Express folded. As a parent there is nowhere better to take small kids, and it was one of the first proper restaurants I went to as a teenager (my local even had a real Jazz piano!).”
Bloomberg reported that the company will sit down with creditors in a bid to organise the company's £665 million of debts.
Separately, a group of secured bondholders for the business have also started working with advisory firm Perella Weinberg Partners in relation to the talks, according to the report.
Pizza Express declined to comment.
Sources close to the company said it is "not a business that is contemplating a CVA (Company Voluntary Agreement) or close to collapse".
The company, which was bought by Chinese private equity firm Hony Capital in 2014, has to pay the first instalment of its repayments, worth £465 million in secured bonds, by August 2021.
Its next repayment for £200 million in unsecured notes is due to be repaid by the following year.
An industry source added that these talks with creditors are "not unusual", but "could mean that covenants have been broken over its debt repayment".
In the first half of 2019, Pizza Express reported a 0.2 per cent rise in like-for-like sales amid difficult trading conditions.
The company also posted 7.7 per cent decline in underlying earnings to £32.4 million for the period, with the slump blamed on rising costs.