Pizza Hut UK restaurant business ‘hunts buyer following budget hit’

Pizza Hut’s biggest UK franchisee has been reported to be approaching potential buyers as it looks to offset cost increases set out in last month’s budget.

 

Franchisee Heart With Smart (HWS), which operates about 140 dine-in Pizza Hut restaurants, is looking for a buyer or capital injection amounting to tens of millions of pounds, according to Sky News. 

 

It has been reported that the restaurant group, which has around 3,000 employees, is working with Interpath Advisory.

 

Pizza Hut’s UK delivery business is unaffected. 

 

Operators have been totting up the cost of changes to employer National Insurance Contributions (NICs) alongside increases in national minimum wage and a reduction in business rates support since last month’s budget.

 

Chancellor Rachel Reeves announced an increase in the rate of employer Class 1 NICs from 13.8% to 15%.

 

The government also reduced the per-employee threshold at which employers become liable to pay National Insurance from £9,100 to £5,000 a year.

 

UKHospitality has said the increase will amount to a 10% increase in the cost of employing a worker, amounting to at least £2,500 per employee.

 

HWS operates the dine-in arm of Pizza Hut in the UK and has operated as a fully franchised business since 2012 when it was acquired by private equity firm Rutland Partners and the group’s management team.

 

Interpath Advisory declined to comment.

 

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