Directional Capital to acquire Pizza Hut UK operations

Directional Capital, a private equity firm, is in advanced discussions to acquire Pizza Hut UK’s restaurant operations.

The proposed deal would include 140 sites and save most of the 3,000 jobs tied to the business. Only a small number of outlets are expected to close, according to Sky News.

The transaction would likely involve a pre-pack administration of HWS. This approach aims to help the business navigate financial pressures caused by rising costs. Directional Capital, which already manages Pizza Hut’s operations in Denmark and Sweden, is expected to leverage its expertise to revitalise the UK business.

HWS has faced significant challenges, including a projected £4m increase in annual costs due to wage hikes and employer National Insurance Contributions from April 2025. In November, HWS joined 220 hospitality firms in warning the Chancellor of job cuts and closures caused by the tax increase. Cross-party MPs also criticised the government’s NIC plans, describing the impact on hospitality as “catastrophic.”

Pizza Hut’s UK delivery services, managed by independent franchisees, will not be affected by the deal. HWS has a complex ownership history, including a 2018 management buyout led by UK chief executive Jens Hofma, backed by Pricoa Capital Group. In 2012, Rutland Partners acquired the business for a symbolic £1 during a financial downturn.

The potential acquisition reflects Directional Capital’s strategy of investing in high-potential businesses under financial strain. If finalised, this deal could stabilise Pizza Hut’s dine-in operations and secure its long-term presence in the UK market.

Source: The Caterer

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