German restaurant franchise company Vapiano said on Thursday it had applied to start insolvency proceedings, becoming another high street casualty of a national coronavirus lockdown that is expected to remain in force for weeks.
Parent company Vapiano SE said it had filed for insolvency at a district court in Cologne and was evaluating whether insolvency applications would need to be filed for its group subsidiaries.
Shares in Vapiano, whose restaurants offer pizza, pasta and salads, collapsed by two-thirds, bringing year-to-date losses to over 90% and putting the company in penny stock territory with a market value of just $25 million.
The company said it had not been able to agree with shareholders and creditors on a liquidity injection of 36.7 million euros ($40 million), leaving it unable to apply for aid under a government relief programme.
All German restaurants operated by Vapiano SE will remain closed until further notice, while German and international franchisees are not affected by the insolvency filing.
Department store chain Galeria Karstadt Kaufhof is seeking protection from creditors to stay afloat, it said on Wednesday, after nationwide store closures to try and contain the spread of the coronavirus.
Source: Reuters.com