Italian restaurant chain Prezzo will shut 94 branches with the loss of around 500 jobs after it agreed a rescue plan with creditors on Friday.
The closures amount to almost a third of Prezzo‘s restaurants across the UK and include all 33 of its Chimichanga Tex-Mex outlets.
The struggling firm proposed a restructuring deal known as a company voluntary arrangement (CVA) to reduce costs earlier this month.
On Friday, 88 per cent of creditors voted in favour of the proposals.
The 94 restaurants identified for closure are likely to cease trading in April and May, the company said. While the CVA involves a requirement to make redundancies, the company said every effort will be made to redeploy those team members affected by the closures.
Prezzo will pay rent reduced by between 25 per cent and 50 per cent on 57 of the sites remaining open.
The chain has been hit by a host of problems that are causing turmoil in the casual dining sector. Consumers have cut back on discretionary pay, while the National Living Wage has risen and business rates have soared.
The fall in the value of the pound has also increased import costs.
Jamie’s Italian and burger chain Byron have also entered CVAs this year.
Jon Hendry-Pickup, chief executive 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.”
