Business

Prezzo restaurant chain to close 92 outlets

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Creditors of the Italian restaurant business Prezzo have backed a restructuring plan that will see it close 92 outlets – about a third of the chain, the BBC understands.

It’s estimated the move, backed by most creditors, could result in up to 1,800 job losses.

The chain, which is owned by private equity firm TPG Capital, employs about 4,500 people.

Prezzo is closing all of the 33 outlets of its TexMex chain Chimichanga.

The closures aim to repair Prezzo’s financial position and allow it to continue trading.

The deal was struck under a restructuring arrangement know as a company voluntary arrangement (CVA) – a step short of going into administration.

Prezzo was bought by TPG in 2014 for just over £300m.

It is the latest of a number of restaurant chains to run into difficulties.

Burger chain Byron and Jamie’s Italian have both had to undergo similar restructurings this year, agreeing rescue plans with their lenders and landlords, and closing restaurants.

The wider retail market is also suffering. The UK arm of toy retailer Toys R Us and electronics chain Maplin both collapsed into administration this week.

Businesses on the High Street are facing a tough environment. Wage growth has not kept up with inflation, which has hit the spending power of shoppers.

Business costs such as the National Living Wage are going up, and business rates will rise for many firms in April. Many firms are also facing increasing competition from online retailers.

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