Prezzo restaurants in Shropshire saved from closure
Three county Prezzo restaurants have been saved from closure, it was announced today.
It comes after the Italian chain said it will close 94 of its restaurants across the UK – as well as its Tex-Mex chain Chimichanga – in a bid to try to rescue its business.
A proposed company voluntary agreement (CVA) published by Prezzo revealed that the Telford, Bridgnorth and Oswestry branches would not be among the 94 restaurants to close nationwide.
However, the Chimichanga in Telford's Southwater complex, will close as part of the restructuring plans – and Prezzo's branch in West Bromwich is also earmarked for closure.
Prezzo’s proposed CVA will allow it to reduce the rent paid on some sites and enable it to terminate leases at sites that would not be economic, even with reduced rent.
The restaurant closures are expected to begin next month.
The chain, which is working with AlixPartners on the restructuring, employs 4,500 people at its restaurants in the country.
Jon Hendry-Pickup, chief executive of the company said: "Prezzo’s core business is fundamentally strong and has fantastic potential.
"However, the well-documented pressures on our industry mean a number of our restaurants are underperforming.
"While we continue to be profitable and cash-generative, our position is not sustainable, so we must take decisive action now to ensure we’re able to thrive in the future."
He added: "We recognise this process will impact many of our team members and their families.
"We are committed to keeping them informed, and will be doing all we can to support them during this difficult time."
The CVA sees the debts of the company put on hold while a buyer is sought. This is the last step before going into administration.
It is thought the closure of the 94 branches will result in around 1,000 job losses. However Prezzo, which is owned by private equity firm TPG Capital, has said it will try to find staff new roles within the business.
The news comes at a bleak time for the high street and the casual dining sector in particular. This year has also seen burger chain Byron and Jamie's Italian undertake CVAs as they come under increasing pressure from rising costs and falling consumer confidence.