For nearly £1bn, Pizza Express goes East

picture of PizzaExpress

In the UK they are almost as ubiquitous as Starbucks or McDonald’s, now PizzaExpress will be rolled-out across China, following a £900m buyout by a Chinese private equity firm. The chain, founded in London’s Soho back in 1965, has more than 500 outlets across the country and has inspired the biggest European restaurant sector deal of the last five years.

Hony Capital won an auction to buy the business, fending off Citic (another Chinese investment group) and four other private equity firms.

PizzaExpress opened its first outlet in Beijing two months ago and already has 12 restaurants in Hong Kong and nine in Shanghai. Hony Capital’s chief executive, John Zhao, hopes to accelerate its growth in the Chinese market, as well as to continue its expansion in the UK, with a further 200 restaurants planned here.

The restaurant group was previously owned by European private equity firm Cinven (owners of the Gondola Group), who bought it for £1bn at the end of 2006. However Cinven’s reported £1.2bn debt mountain meant that despite a rise in PizzaExpress sales last year, the private equity company still made a loss of £79m in 2013. Cinven has already sold burger chain Byron to Hutton Collins for £100m and is reportedly looking to offload its other Italian chains, ASK and Zizzi.

 

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