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CPK has spent the past few months lowering costs by slashing corporate pay by 35%, renegotiating leases with landlords and postponing store renovations. The company has about 15,000 employees and about 6,000 of them were furloughed in April and May.
Under its proposed restructuring plan, CPK would reduce its current debt of $403 million to about $174 million, with rolling payments due until the end of 2024. The company announced $47 million in new financing Thursday that will help keep stores open.
One of the nation’s most popular pizzeria chains filed for bankruptcy Thursday, blaming the coronavirus pandemic for its financial struggles. California Pizza Kitchen said it will continue operating as usual while working through a Chapter 11 restructuring plan aimed at reducing its debt by $230 million.
California Pizza Kitchen is the latest fast casual chain to file for bankruptcy as the pandemic and its debt burden hampers its operations. The 35-year-old pizza chain filed for Chapter 11 Thursday, explaining that the process will help it “reduce its long-term debt load, and quickly emerge from bankruptcy as a much stronger company.”
Why did CPK close its stores?
The closures especially hurt CPK, Hyatt said in court documents, because 78% of total sales prior to the pandemic came from in-store dining.
The company has about 15,000 employees and about 6,000 of them were furloughed in April and May.
Under its proposed restructuring plan, CPK would reduce its current debt of $403 million to about $174 million, with rolling payments due until the end of 2024. The company announced $47 million in new financing Thursday that will help keep stores open.
CPK joins a list of restaurants that have declared bankruptcy during the pandemic. Chuck E. Cheese filed for Chapter 11 in June, while grab-and-go food chain PQ New York filed for Chapter 11 in May.
California Pizza Kitchen said it will continue operating as usual while working through a Chapter 11 restructuring plan aimed at reducing its debt by $230 million. The pizzeria hinted in its filing that it will close some of its 200-plus locations, though it expects to exit bankruptcy in less than three months.
Is California Pizza Kitchen going bankrupt?
California Pizza Kitchen emerges from bankruptcy. California Pizza Kitchen has completed its bankruptcy restructuring with an equity transaction that eliminated more than $220 million in existing debt from its capital structure, the company said Monday. The Los Angeles-based casual-dining brand said it “now faces no near-term debt maturities” …
The Los Angeles-based casual-dining brand said it “now faces no near-term debt maturities” and that substantially all of CPK’s equity is now held by CPK’s pre-petition lenders. CPK had filed July 30 for Chapter 11 reorganization in the U.S. Bankruptcy Court for the Southern District of Texas.
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