Prezzo's creditors approve CVA including closure of 94 sites
Prezzo's creditors have approved a CVA that will see the closure of 94 sites and rent cuts of up to 50%.
The move, approved by 88% of creditors, will include the closure of all branches of the group's Tex-Mex brand Chimichanga with about 1,000 redundancies expected across the group. The restaurants are expected to close between April and May.
Jon Hendry-Pickup, CEO of Prezzo, said: "I would like to thank our creditors and landlords for supporting our transformation plan. While we continue to be profitable, the pressures on our industry have been well documented.
"Despite this being a tough decision, the support given today by our creditors shows that they believe we have the right approach to transforming Prezzo in the eyes of teams, customers and stakeholders. It has been a challenging time during the CVA process and I would like to thank our suppliers, colleagues and customers for their patience and support."
The Caterer understands that Prezzo requested rent reductions of 50% for one year at 22 sites, and 25% for two years at 39 sites.
Though the terms of the CVA would normally mean the chain defaults on its £155m debt, it has received a waiver from lenders.
The brand, owned by American private equity business TPG, appointed consultants at AlixPartners to oversee the financial restructuring.
Prezzo is the latest restaurant to be hit by tough trading conditions affecting the casual dining sector, and the news follows recent announcements that Jamie's Italian and burger chain Byron have entered into CVAs.
Prezzo was acquired by TPG in 2014 for £304m from the Kaye family, who founded the business in 2000.
Prezzo confirms CVA bid including closure of 94 sites>>
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