Earl Enterprises, the company behind Planet Hollywood, Earl of Sandwich, and Buca di Beppo, has purchased Italian chain Bertucci’s out of bankruptcy. Earl Enterprises, which operates about 130 total locations, will pay more than $3 million in cash for Bertucci’s, as well as issue $13 million in new second-lien debt, and take on $4 million in debt.
Bertucci’s Corp. filed for Chapter 11 bankruptcy protection in mid-April, although it revealed at the time that it had a deal lined up to sell the 58-unit business for about $20 million. The announced buyer, however, was not Earl Enterprises. Instead, it was Chicago-based investment firm Right Lane Capital LLC. Earl Enterprises’ topped the offer and won the bidding. Right Lane will receive a breakup fee and expense reimbursement of $995,000 for its position as stalking horse bidder. The company is also the backup bidder in case the deal, which is expected to close later in June, falls through.
Judge Mary Walrath approved the sale June 5 in the U.S. Bankruptcy Court in Wilmington, Delaware.
Robert Earl, Earl Enterprises’ founder, told The Wall Street Journal that he knows the brand and plans to rebuild it. The company also expects to keep its name as well as management team. Brian Wright is its CEO, and Brian Connell chief financial officer. Bertucci’s was previously owned by Levine Leichtman Capital Partners out of Los Angeles, and had about $119 million in debt, according to a court filing, when it filed for bankruptcy protection.
Bertucci’s debuted in Somerville, Massachusetts, in 1981. It hit its peak in the late 1990s when there were over 100 restaurants. At the time of its bankruptcy filing, the company had 969 full-time employees and 3,245 part-time employees. The restaurant is known for its brick-oven pizzas, handcrafted pastas, exhibition kitchens, and homemade Italian signatures. Bertucci’s switched up the menu by reviving classic recipes in 2016 when its original executive chef, Rosario Del Nero, returned to the company. It also launched a mobile app in September 2017, but couldn’t deliver on its debts in time. It also tried to ignite a new daypart with Express Lunch, which promised to serve food in 15 minutes or less. But a forbearance agreement with lenders expired in 2018.
Law firm Proskauer Rose LLP represented Earl Enterprises in the deal. Partner Vincent Indelicato told the court Bertucci’s has a bright future under the new deal, and jobs should be saved by the move.
The company hired Hilco Real Estate LLC in January to review its leases and negotiate better terms—a move that saved the company $3.5 million on 17 leases. In total, with job cuts and other maneuvers, the company saved more than $5 million. In April, court papers showed the chain planned to reject 29 money-losing leases, and could still close some locations. Bertucci’s said at the time it “anticipates completing its restructuring process expeditiously so the company will emerge under new ownership, with an improved financial position and stronger brand.”