Prezzo to close almost 100 restaurants with loss of about 500 jobs
About 500 jobs are to go at Prezzo after the restaurant chain agreed a restructuring plan that will lead to the closure of nearly 100 sites.
The company, which is owned by the private equity firm TPG Capital, secured the backing of creditors for a company voluntary arrangement on Friday. The CVA will allow the Italian-themed chain to exit unprofitable branches and secure rent reductions.
A total of 94 of Prezzo’s 300 outlets will close, with about 500 jobs understood to be in danger, although many staff will be redeployed at other restaurants. Prezzo, employs 4,500 people.
The CVA proposal was backed by 88% of the creditors, including landlords.
Jon Hendry Pickup, the 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.”
Prezzo said the restaurants identified for closure were likely to shut in April and May and that staff would be made aware of the exact dates as soon as they have been confirmed.
The announcement comes at a bleak time for the high street and the casual dining sector in particular.
The burger chain Byron and Jamie’s Italian have had to undertake CVAs this year as they come under increasing pressure from rising costs and falling consumer confidence.
Quick guide What's eating the restaurant trade? Show Hide Higher costs Business rates and wages are up, as is the cost of imported food. Wages are up partly because of the rise in the legal minimum but also because finding workers is more tricky. High employment means there are fewer Brits available while the Brexit vote is putting off some EU workers who are already less keen because of the lower value of the pound. The rise of delivery Deliveroo, UberEats and Just Eat are driving a rise in demand for home delivery, cutting the number of customers eating out. Over-expansion Until 2015/16, dining out was growing strongly. Private equity firms helped mid-market chains expand, which increased competition just as the market was feeling the squeeze. Spending shifts Takeaway breakfasts and lunches are also diverting money away from sit-down restaurants. Photograph: Kristin Lee/Tetra images RF
As well as staff costs and lower footfall, the chains have been stung by the collapse in the pound, which has ramped up the cost of buying ingredients. Soaring business rates, national living wage costs and the apprenticeship levy have also taken their toll, as has oversaturation of the middle market.
It has been a difficult first quarter elsewhere on UK high street, with Carpetright announcing the prospect of closing outlets on Wednesday and Moss Bros and Mothercare also in the doldrums.
Earlier this week, New Look agreed a restructuring plan with creditors that will see it shut 60 stores, resulting in the loss of up to 980 jobs.
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Creditors of restaurant group Prezzo have backed a restructuring plan that will see it close 94 outlets - about a third of the chain.
It is estimated the move could lead to 500 job losses. The chain, which is owned by private equity firm TPG Capital, employs about 4,500 people.
The 94 closures include restaurants under the Prezzo, Mexico and Cleaver brands and all 33 Chimichanga sites .
Under the rescue plan, rents will be cut by between 25% and 50% at 57 sites.
The closures and rent reductions aim to repair the group'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.
Jon Hendry-Pickup, chief executive of Prezzo, thanked the company's creditors and landlords for their support.
He said: "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."
Media playback is unsupported on your device Media caption Trouble for High Street restaurants
The restaurants identified for closure are likely to close in April and May. Prezzo said that staff would be made aware of the exact dates as soon as they had been confirmed.
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 recently collapsed into administration.
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. Companies are also facing increasing competition from online retailers.
List of Prezzo-branded restaurant closures
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You can find this dish at one of Boston’s chicest hotel restaurants or stand and slurp it at a counter-only shop, but whatever you do, don’t call ramen a simple soup. Deep and rich yet also light and fresh, ramen is the culinary equivalent of the finest Tchaikovsky pas de deux — and the complexity of the fine broth is just about as hard to pull off. Here’s where to go for places that do just that.
1. Banyan Bar + Refuge
Perfect date-night fare for those craving something soulful and sexy, minus the slurp, Banyan’s mushroom bolognese sauce noodles put a fun spin on a soupy favorite. And for those who paused on “bolognese,” Chef Scott Jensen’s delight can be made vegan-friendly. Both the ramen and the cocktail list will have you planning a return visit. (553 Tremont St., Boston)
Miso ramen at Ganko Ittetsu Ramen in Brookline. —Erik Jacobs for the Boston Globe
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2. Ganko Ittetsu Ramen
The city of Sapporo is known for its street food as much as its beer. Ganko’s noodles are imported from Japan’s fifth-largest city, and the soy sauce and miso come from an old Japanese microbrewery, adding depth to the flavors. While typical ramen is made by mixing tare (sauce) with the base broth and adding noodles, Ganko caramelizes its tare with vegetables, and then the base broth is added to bowls like gankara spicy miso, shio sea salt miso, and gantetsu with crunchy garlic. (318 Harvard St., Brookline)
3. Ginger Exchange
This restaurant’s menu overflows with sushi, sashimi, noodle, and rice dishes, so it would be easy to pass by the ramen. That would be a mistake, as it offers (as their menu calls it) a “heaping bowl of pure goodness” with savory chicken, vegetarian, or spicy coconut curry broths, and, for protein, chicken, shrimp, or pork belly options. Its bustling location near Symphony Hall and Northeastern and its jovial atmosphere make Ginger Exchange a wallet-friendly prelude to a night out on the town. Cantabrigians can get their fix right in Inman Square. (250 Huntington Ave., Boston; 1287 Cambridge St., Cambridge)
4. Hakata Ramen
Chinese, American, and Middle Eastern dining options are all nestled into this easy-to-access spot near the Red Line at Wollaston. Ramen aficionados swear by the spicy options at Hakata (especially the gekikara pork bone), but those with larger appetites may gravitate toward the ramen-and-sushi combo with signature soup for that real warm-and-full-belly experience. (The daily special rolls vary Monday through Friday.) (673 Hancock St., Quincy)
Chicken ramen at Hojoko in Boston. —Aram Boghosian for The Boston Globe
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5. Hojoko
It takes two days to tango here if you’re making Funky Chicken Ramen. The 48 hours required to make the chicken broth is well worth the wait. The noodles here are served with a soy egg, menma, and robata-grilled chicken. And since you’re in a rock-and-roll-themed izakaya, why not kick up the spice a notch with a side of fermented chili relish? (1271 Boylston St., Boston)
6. Itadaki Izakaya
It may offer a tony Newbury Street view, but Itadaki also gives diners a price range and taste that are street food-friendly. When the patio’s closed, thick noodles like the Itadaki tori paitan ramen provide a way to escape Back Bay’s winter bluster. Optional spice comes on the side in the form of a house-made miso paste, so the flavor is customizable. (269 Newbury St., Boston)
The spicy miso ramen at Little Big Diner in Newton. —The Boston Globe
7. Little Big Diner
Bye-bye, burgers — this diner brings the Far East to MetroWest with rice bowls and ramen. The latter occupies half of the menu, with plenty of tongue-twisting mushrooms that evoke a scene from “Alice in Wonderland”: maitake, shiitake, wood ear, enoki. You’ll be glad you fell down the rabbit hole with thick, cloudy paitan broth combined with chicken ramen, miso ramen, or the chef’s ultra ramen, which comes swimming with chashu pork, chicken thigh, and chili ground pork with sprouts and scallions. (1247 Centre St., Newton)
8. Little Donkey
You don’t need a passport to dine like a globetrotter at Little Donkey. Its shareable international plates and mix of seating options, including communal benches, provide a special kind of food community, where matzo ball ramen fuses a Japanese specialty with a Jewish one. Intense chicken broth has burnt onion, schmaltz tare, and corn, and is the base for matzo balls and mouthwatering spicy chicken. Get your slurp on with a friend by ordering the full-sized portion. (505 Massachusetts Ave., Cambridge)
Truffle shoyu at Oisa Ramen in Boston. —Jonathan Wiggs/Globe Staff
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9. Oisa Ramen Slurp & Go
Make sure you plan enough time to eat at this tiny 12-seat shop, as you can’t carry out the ramen. But it will be a lunchtime well spent at owner Moe Kuroki’s first brick and mortar after scoring rave reviews over three years of pop-ups. Check out her traditional tonkotsu (pork bone) soup or the vegan-friendly shoyu base with a variety of vegetables Monday through Friday from 11 a.m. to 2:30 p.m. (2 Broad St., Boston)
10. Pagu
It’s no surprise that, with a resume including time at acclaimed Boston sushi favorite O Ya, Chef Tracy Chang has an affinity for ramen. At Pagu, expect something similar to what was on the menu when she co-founded the pop-up Guchi’s Midnight Ramen. There’s house-made alkaline noodles, three broth styles, pork belly, umami oil, and a six-minute egg, all as appealing as Pagu’s sleek environs in Central Square. (310 Massachusetts Ave., Cambridge)
Ruckus’s black garlic mazeman features homemade noodles from the owners of Shojo and Best Little Restaurant. —Ruckus
11. Ruckus
This Chinatown hot spot brings a new-school approach to an old-school dish, with hip-hop decor and homemade noodles with funky “swag” add-ons like chashu pork neck, chicken chicharrón, and an umami “bomb” (a seasoned blend of whipped pork fat). Cool options like the tsukemen dip help test your chopstick-and-spoon skills — these buckwheat noodles dipped in a separate bowl of broth also include Japanese squash curry, charred radicchio, crispy sprouts, myoga, and hazelnut oil. (5 Tyler St., Boston)
12. Santouka
It’s fitting that one of Santouka’s two area locations is right in Harvard Square, as Japanese founder Hitoshi Hatanaka’s original goal was to educate high school- and college-aged foodies about the rare toroniku char siu ramen. Made with the “rarest of the rare” pork cheek meat, this ramen — and the huge portions of it — are a hit here. To make the signature tonkotsu broth, pork bones are simmered for 20 hours. The soy-based vegan option is a winner, too. (66 Hereford St., Boston; 1 Bow St., Cambridge)
The miso ramen at Shabu & Mein in Cambridge. —Suzanne Kreiter/Globe Staff
13. Shabu & Mein
Jimmy Liang and Peter Tse built an Asian food empire in Quincy with hits like Shabu and Fuji. Their ninth restaurant, Shabu & Mein in Cambridge, offers a bit of a twist. Friends can gather in the main dining room to cook their own meat at their table, or those with a bit less time (and company) can belly up to the bar to slurp ramen options that include a spicy mushroom variation, a vegetarian one, and even one with gluten-free noodles. (148 1st St., Cambridge)
14. Shojo
The midday-only ramen at Shojo is worth planning a work lunch around. Only available Thursday through Saturday, the ramen’s thick broth is loaded with chewy noodles, barbecued pork, and a six-minute soft-cooked egg. Order “kae-dama” to get extra noodles for $3. (9A Tyler St., Boston)
15. Snappy Kitchen and Snappy Sushi
Snappy’s Newbury Street location may have Japan’s most ubiquitous food import in the title, but the ramen dishes here — and at Somerville’s Snappy Kitchen — are standouts as well. Rich and creamy tonkotsu pork bone broth takes center stage, although vegans have a hearty yam noodle-based option, too, with tomato broth. (108 Newbury St., Boston; 234 Elm St., Somerville)
The mega ramen at Totto Ramen in Allston. —Dina Rudick/Globe Staff
16. Totto Ramen
Those who live on the Orange Line had a reason to celebrate in late 2016 when Somerville got an outpost of this Allston Green Line favorite. At Totto Ramen, house-made noodles round out a New York-style broth that has a chicken base (as opposed to pork), and there’s a vegetarian option with a seaweed and shiitake base, too. Diners with larger appetites can opt for the mega ramen, an oversized bowl with garlic and several variations of pork. (169 Brighton Ave. Boston; 463 Artisan Way, Somerville)
17. Uni
The ramen on Uni’s late-night menu — courtesy of James Beard Award-winning Chefs Tony Messina and Ken Oringer — is proof that good things come to those who wait. The pork and miso-soy broth is as quintessential as this dish gets, and for those light on cash, the cult foodie favorite is a nice way to get a taste of what other Asian fare can be ordered from the regular menu. (370 Commonwealth Ave., Boston)
18. Wagamama
Tuck into the spicy, light, or rich broth offerings with a fun wooden spoon (OK, you could call it a mini shovel) and enjoy the people-watching through the floor-to-ceiling glass windows at any of three area locations. The signature ramen is probably best for those who have trouble choosing, as it’s a smorgasbord of roast beasts: sliced grilled chicken, barbecue pork, chikuwa Japanese fish cake, prawns, and mussels. (1 South Market St., Boston; 800 Boylston St., Boston; 100 Northern Ave., Boston)
19. Ward 8
Nestled in a quiet corner near North Station with a chic, rustic space and large marble bar that makes it an outlier among sports pubs, Ward 8 provides respite that’s as comforting as, well, a bowl of soup. New Chef Tyler Potter puts a twist on ramen here with a heartier, well-seasoned shoyu broth (which mixes soy beans and wheat), along with colorful bok choy, scallions, pork belly, and a soft egg. (90 North Washington St., Boston)
The pork ramen at Yume Wo Katare in Cambridge. —Matthew J. Lee/Globe Staff
20. Yume Wo Katare
Ever wondered why there’s a random string of people lined up in Porter Square at all hours of the day, rain or shine? They might be waiting for Yume Wo Katare. Ramen is the only thing on the menu here, and while the space is small — just a snug counter and some long benches — the flavors are big. Jiro-style ramen has a long chew with thick noodles and chunks of pork fat in a thin, rich pork gravy broth. This spot is cash only, so don’t forget to hit the ATM first. (1923 Massachusetts Ave., Cambridge)
