Uno vows Chapter 11 is only temporary setback
Uno Restaurant Holdings Corp., a Boston-based chain that has nearly 30 restaurants in Massachusetts, said today that it has filed for Chapter 11 bankruptcy protection as it looks to restructure its debt.
While the company just closed 16 underperforming restaurants, customers at the company's remaining 179 restaurants won't notice any visible changes, said Rick Hendrie, Uno's senior vice president of marketing, during a telephone interview.
Three of the restaurants that closed were in Massachusetts - one in Kingston, one in Methuen, and one in Fairhaven. Most of the other closed restaurants were in regional markets such as Denver where Uno had only one or two locations, Hendrie said.
(The chain is known for deep-dish pizza, which is shown at right in a Globe file photo.)
Uno's moves come as many consumers are cutting back on restaurant meals during tough economic times. Some consumers are eating at home rather than dining out, and others trading down and ordering from the dollar menus of big fast-food chains.
Looking to restructure its debt, Uno said it elected to voluntarily file for Chapter 11 protection with the US Bankruptcy Court in the Southern District of New York after 18 months of negotiations with its bondholders and lenders.
"A majority of the bondholders, the senior lenders, the current ownership and management - everybody's on board with this," said Hendrie of the reorganization plan and Chapter 11 filing.
Hendrie added that the company's current management team under president and chief executive Frank Guidara will remain in place.
"The brand is strong; it's the balance sheet that needs fixing," Guidara said in a statement.
In its press release, Uno said that its restructuring will eliminate substantial debt through the conversion of $142 million of senior notes into a controlling equity stake; Uno's also announced a $52-million debtor-in-possession credit facility that will provide stability through the reorganization process.