(WAND) - NPC International, the largest U.S. franchisee of Yum Brands’ Pizza Hut, has filed for Chapter 11 bankruptcy.
The company operates more than 1,200 Pizza Huts and nearly 400 Wendy’s.
Pizza Hut reported same-store sales growth in April and May, due to higher digital and delivery sales.
But the coronavirus pandemic added to years of slumping U.S. sales. NPC has a debt of roughly $1 billion.
By filing for Chapter 11 protection, NPC can continue to operate while it tries to turn business around.
The franchisee pre-negotiated a restructuring agreement with most of its lenders.
“While NPC’s Chapter 11 filing was expected, we view it as an opportunity to create a better future for NPC’s Pizza Hut restaurants,” a Pizza Hut spokesperson said in a statement to NBC. “As NPC works through this process, we support an outcome resulting in an organization with a lower, more sustainable level of debt, ownership focus on operational excellence and a greater level of restaurant investment.”
