Pizza Hut and Wendy's Franchisee NPC Files for Bankruptcy

NPC International, the operator of 1,200 Pizza Hut and nearly 400 Wendy's restaurants in the United States, has filed for bankruptcy, Report says, citing CNN.

The franchise has been dealing with a perfect storm of problems that led to its Chapter 11 filing on Wednesday, including coronavirus-related shutdowns, a massive debt burden of nearly $1 billion, and rising labor and food costs. Pizza Hut, of which NPC is the company's largest franchisee, has also been struggling with sales.

NPC's restaurants will continue to operate while it navigates the Chapter 11 process. The company employs nearly 40,000 people in 27 US states, according to its website.

"As NPC works through this process, we support an outcome resulting in an organization with a lower, more sustainable level of debt, ownership focus on operational excellence, and a greater restaurant investment," a Pizza Hut spokesperson said. The company added that filing would "strengthen the overall health and performance of the entire system for the long term."

Pizza Hut, which is owned by Yum! Brands (YUM), pointed toward a recent filing showing that sales at its US restaurants open at least a year have begun rebounding off their March lows. Pizza Hut has 7,100 restaurants in the United States.