DEDHAM, Mass. – PGHC Holdings Inc., the parent company of Papa Gino’s and D’Angelo Grilled Sandwiches restaurants, filed for Chapter 11 bankruptcy in Delaware and entered into a stalking horse agreement to sell the company to Wynnchurch Capital, the company announced Monday.
The company also confirmed the closure of 95 restaurants this week, which the company determined to be “underperforming.”
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Roughly 100 Papa Gino’s and 78 D’Angelo Grilled Sandwiches restaurants have remained open.
“We are pleased to have reached an agreement that will ensure a long and prosperous future for these iconic New England restaurants,” said Corey Wendland, PGHC’s chief financial officer, said in a statement. “For some time, we have been pursuing a plan to strengthen our financial footing and secure capital for investment in our restaurants, while also addressing our significant debt load. We are confident that the agreement with Wynnchurch achieves all of those goals.”
The company said the acquisition would allow the company to remodel and modernize the 141 remaining, company-owned restaurants in Rhode Island, Connecticut, Massachusetts and New Hampshire.
Per the rules of a stalking horse bid, PGHC will solicit competing offers to maximize the value of the sale. The sale will require approval from a bankruptcy court.
The company still has Papa Gino’s locations in East Providence, Lincoln, Smithfield, Warren, West Warwick and Woonsocket, as well as Attleboro, two stores in Attleboro, Fall River and Taunton, and one in Somerset.
The company also reported more than 13 D’Angelo stores in Rhode Island still in operation and seven stores in Bristol County, Mass.
It wasn’t immediately clear exactly how many local stores shut down as part of the 95-store closure.
As of 12:45 p.m. Monday, no worker Adjustment and Retraining Notices had been posted by the R.I. Department of Labor and Training or the Mass. Department of Employment and Training, so it is so far unclear how many local employees were impacted by the closures. However, a company spokesperson confirmed to PBN that overall, the closures were expected to impact approximately 1,100 workers. The company said that it would work to find the displaced employees work at other locations where possible.
“These were hard decisions but decisions we believe were absolutely necessary to allow Papa Gino’s and D’Angelo Grilled Sandwiches to continue serving New England now and for years to come,” Wendland said.
