A Leading Comfort Food Chain Files an Unexpected Bankruptcy Abroad

Just nine months after a U.S. private equity firm scooped up Pizza Hut’s UK dine-in operations in a bid to turn things around, the chain is shuttering dozens of locations across the country, putting more than 1,200 jobs on the line.

The move comes as franchisee DC London Pie entered administration — Britain’s rough equivalent of bankruptcy — on October 20, 2025, capping a whirlwind year of financial turbulence for one of the world’s biggest pizza brands.

The fallout is stark: 68 Pizza Hut restaurants and 11 delivery kitchens are set to close their doors for good, affecting sites from bustling London spots like Beckton and Croydon to regional outposts in Bournemouth, Carlisle, and Inverness.

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That’s everything from the Vicar Lane eatery in Bradford to the Tower Park branch in Dorset, with full lists circulating among affected staff and local media.

In a silver lining, parent company Yum! Brands stepped in with a pre-packaged deal to buy the remaining 64 stores, aiming to keep 1,277 workers on the payroll and steady the brand’s presence in a market it’s called home since opening its first UK outlet in 1973.

“This targeted acquisition aims to safeguard our guest experience and protect jobs where possible,” said Nicolas Burquier, Yum! Brands’ managing director for Pizza Hut Europe and Canada, in a statement released shortly after the administration filing.

The administrators from FTI Consulting — Matthew Boyd Callaghan, Lindsay Kate Hallam, and Christopher Jon Bennett — echoed the sentiment, noting the sale “provides a stable platform for one of the UK’s best-known dine-in brands.”

A Quick Pivot That Didn’t Stick

The story traces back to January 2025, when DC London Pie — backed by Directional Capital, a U.S. firm already running Pizza Huts in Sweden and Denmark — acquired the UK dine-in business from previous operator Heart with Smart.

That earlier franchisee had racked up £50 million in debt, prompting the handoff in a pre-pack deal.

But the economic headwinds didn’t let up. HM Revenue and Customs had slapped a winding-up petition on DC London Pie back in September, signaling unpaid taxes amid broader cash crunches.

Pizza Hut’s UK arm, once a powerhouse with 697 locations at its 2006 peak and employing 14,000 people by 1999, has been no stranger to ups and downs.

It weathered the COVID-19 storm by closing just 29 branches during lockdowns, only to grapple with post-pandemic realities: energy bills spiking, national insurance hikes from the Labour government’s 2024 budget, and inflation hovering at 3.8% year-over-year as of August 2025, per the Office for National Statistics.

Add in fierce rivalry from delivery-heavy players like Domino’s and grocery store “fakeaways” — chilled pizzas up 19% in sales to £1.3 billion annually — and the dine-in model suddenly feels like yesterday’s news.

“This isn’t just about Pizza Hut; it’s the squeeze on the middle,” said one industry observer, pointing to how consumers are recalibrating comfort food around value and convenience.

Families opting for a £12 supermarket pizza deal over a £30 night out? It’s math that adds up in tough times.

Echoes Across the Pond: U.S. Franchises in Freefall

The UK closures aren’t isolated — they’re the latest ripple in a wave of Pizza Hut franchise struggles that started picking up steam last year.

In the U.S., where the chain boasts 6,474 of its 20,225 global locations, things have been equally choppy.

Take EYM Pizza L.P., a major operator that filed for Chapter 11 bankruptcy in July 2024 after a nasty legal spat with Yum! Brands over unpaid royalties and poor performance.

What began with 142 stores across Georgia, Illinois, Indiana, South Carolina, and Wisconsin ended in a fire sale: 77 locations auctioned off in January 2025 to six buyers, including Pizza Hut itself snapping up 18 for $720,000.

The rest? Over 60 shuttered permanently, with EYM listing $23 million in bank debt and another $2.25 million owed directly to the franchisor.

“EYM’s restaurants [were] failing quality assessments at a rate significantly higher than the average Pizza Hut franchise,” court filings revealed, underscoring how operational slip-ups compounded financial woes.

By April 2025, the deals had closed, recovering nearly $12 million for creditors — a far cry from the $46.6 million EYM had sunk into buying and renovating those spots since 2015.

And it’s not just Pizza Hut. The broader pizza sector is reeling.

Bertucci’s, the East Coast Italian chain known for brick-oven pies, filed for its third Chapter 11 in seven years on April 24, 2025, with $10-50 million in debt against similar assets.

Down to 15 locations from 31 in 2022, it’s pivoting to a fast-casual “Pronto” format in Boston, blaming a “shift away from legacy casual-dining brands.”

Meanwhile, Papa John’s axed 74 underperforming UK stores in early 2025, slimming from 524 to 457 outlets, while Domino’s global franchisee shuttered 205 low performers (172 in Japan) between April and June, eyeing $9.72 million in annual savings.

Even smaller players are hurting: MOD Pizza closed 27 U.S. spots across 11 states this year, and local outfits like Minnesota’s Gina Maria’s Pizza (all four locations) and Zeppe’s Tavern in Ohio joined the bankruptcy rolls in March.

The Bigger Picture: A $152 Billion Industry Under Pressure

Zoom out, and the numbers paint a grim portrait for quick-service restaurants.

The global pizza market hit $152 billion in sales last year, per Market.us, with U.S. pizzerias alone pulling in $45 billion in 2025, according to IBISWorld.

Yet Pizza Hut, once the undisputed king until Domino’s overtook it in 2017, posted $13.1 billion in 2024 sales — solid, but trailing its rival’s $19.1 billion.

Systemwide same-store sales dipped 2% year-over-year in Q1 2025, with U.S. figures tanking 7%, as Yum! Brands CEO David Gibbs noted lower-income diners pulling back.

“We’ve seen a more cautious consumer,” Papa John’s CFO Ravi Thanawala told analysts earlier this year.

Domino’s own chief financial officer, Sandeep Reddy, chimed in: “Our comp could be pressured by the macro environment in the U.S., which we have seen intensify across the restaurant industry.”

Factor in U.S. unemployment at 4.3% — the highest since 2001 — and CPI inflation climbing to 2.9% from April’s 2.3%, and it’s no wonder 20% of new eateries fold in year one, with half gone by year five.

The pandemic’s legacy? Yelp data shows 60% of closed spots never reopened.

Franchise models, meant to spread risk, are amplifying the pain.

Operators like EYM and DC London Pie borrowed big to expand, only to get hammered by labor costs (hello, California’s $20-an-hour fast-food minimum wage), supply chain snarls, and diners trading sit-down for apps.

“Consumers have done the arithmetic,” as one analyst put it — why splurge when home delivery or frozen options deliver the same hit for less?

What’s Next for Pizza Hut — and Everyone Else?

Yum! Brands isn’t waving a white flag.

The UK buyout shifts more control in-house, potentially streamlining ops and refocusing on delivery, where Pizza Hut’s melts and value deals have sparked growth before.

Globally, the chain’s experimenting with partnerships, like teaming up with event app Partiful for party pies.

But with competitors like Wingstop UK surpassing £125 million in turnover and Popeyes eyeing £200 million for 2025, reinvention isn’t optional.

For workers facing redundancy — many with just days’ notice — support includes transfer options to saved sites and redundancy payouts. Customers, meanwhile, are mourning staples: “Childhood favourite,” one X user lamented about a closing Edinburgh branch.

As the dust settles, this chapter underscores a harsh truth for the pizza biz: In an era of belt-tightening, even icons have to adapt or get sliced out.

Also Read: A Massive Convenience Store Now Closes 500 Stores

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