Pizza Specific, one of many UK’s best-known casual-dining manufacturers, is poised to obtain a £30 million lifeline from its shareholders, in line with stories from Sky Information.
Bain Capital, the non-public fairness agency, is believed to be spearheading the funding to make sure the enterprise can refinance its £335 million bond due for compensation subsequent yr. The deal has but to be finalised, and Cyrus Capital Companions, one other main bondholder from Pizza Specific’s 2020 restructuring, might also play a task.
The funding comes because the restaurant chain, which operates roughly 350 UK and Irish shops, faces a difficult surroundings. The trade is bracing for added price pressures when Nationwide Insurance coverage funds rise in April, in tandem with a better minimal wage. Hospitality leaders warn these adjustments could curb funding and put additional upward stress on menu costs — a priority given that buyers have already confronted steadily rising prices in recent times.
Pizza Specific’s current historical past has been outlined by possession adjustments and heavy debt. Although it noticed explosive success from the Nineties into the early 2000s, a sequence of takeovers left it saddled with a £1.1 billion debt pile. Curiosity prices reportedly hit £93 million a yr, contributing to a pre-tax lack of £350 million in 2019.
Since then, the chain has closed dozens of eating places, decreased headcount, and launched into a refurbishment drive to recapture the atmosphere of its heyday. Newest publicly obtainable figures present income rose to £367 million in 2023, although the corporate nonetheless posted a pre-tax lack of £6.4 million.
Analysis from CGA signifies that gross sales at prime UK hospitality companies in January have been 1.3% decrease year-on-year. Rising prices, provide chain pressures, and altering shopper habits have mixed to weigh on the sector. Extra eating places could possibly be pressured to boost costs to soak up new labour bills, doubtlessly testing clients’ willingness to maintain eating out.
In the meantime, Pizza Specific’s ambitions for growth or acquisition — it thought of taking on The Restaurant Group (mother or father of Wagamama) in 2023 however withdrew — could also be constrained by market headwinds. The agency hopes that new funding and an ongoing picture refresh will foster resilience in opposition to a quickly evolving casual-dining panorama.
Neither Bain Capital nor Pizza Specific has commented on the reported deal, but when the funding package deal is agreed, it might safe the model’s place because it navigates the prospect of upper taxes and working prices within the months forward.
