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Cici’s Pizza filed for bankruptcy

Cici’s Pizza filed for bankruptcy
Posted at 6:30 AM, Feb 03, 2021
and last updated 2021-02-02 12:00:23-05

Buffet pizza chain Cici’s Pizza filed for chapter 11 bankruptcy on Jan. 25, unable to remain viable amid the pandemic’s in-person dining restrictions and food-delivery boom.

Cici’s Holdings Inc.’s filing came with a plan to sell to lender D&G Investors, the Wall Street Journal reported. Under the plan, D&G will reorganize in an expedited bankruptcy process that’s expected to be completed by March.

Cici’s Pizza got its start in 1985. The company offers an all-you-can-eat style buffet specializing in a wide variety of pizza options, salads and desserts. It has 318 locations — down from its peak of 650 in 2009.

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The “uncertainty, unexpected challenges, and ever-changing landscape” of the coronavirus pandemic left the company with “severely strained” finances, Chief Financial Officer Richard Peabody said in a statement.

The pandemic forced the temporary closure of 203 Cici’s Pizza locations in March, while permanently shutting down 61 restaurants. To try to save the company, Cici’s Pizza executives took a 25% pay cut, and corporate positions were downsized by 39 jobs, according to the company’s legal filing.

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Even with trying to shift its business model to an online ordering and delivery-based system, Cici’s Pizza couldn’t seem able to keep up with other restaurants. The popularity of food delivery from well-known restaurants and services like DoorDash cut into CiCi’s attempt to change their business practices.

“This trend poses significant challenges to Cici’s all-you-can-eat buffet model, which depends on in-store dining for approximately 99% of its revenue,” Peabody said in the court filing.

After falling into default on its loans with Wells Fargo and other lenders in Aug. 2020, Cici’s tried negotiating to settle the debt. However, that did not work. On Dec. 15, 2020, Cici’s Pizza sold $82 million of debt to D&G Investors.

Despite the Chapter 11 bankruptcy filing, Cici’s Pizza can still operate while it waits for approval of its plan to repay its creditors, which it hopes to have ready by the end of March.

Meanwhile, Cici’s tweeted that their stores are still open for pizza:

The company is still offering online ordering for pickup or delivery.

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