Even in the best of times, Chuck E. Cheese dd not inspire thoughts of cleanliness and a hygienic atmosphere. The chain of child-friendly restaurant-slash-activity centers has always had the reputation of being a place for children’s birthday parties, where you eat surprisingly good pizza off of paper towels on sticky tables while your children crawl through elaborate playsets. It is, perhaps, the last place one would imagine ordering food from in the middle of a pandemic. So it’s no surprise that Chuck E. Cheese’s parent company, CEC Entertainment Inc., is scrambling to secure enough loans to avoid a catastrophic bankruptcy filing.
According to a report in the Wall Street Journal on June 7, 2020, the company is nearly $1 billion in debt, and trying to raise money from lenders to pay $1.9 million to creditors due by the end of June. At the same time, their first-quarter sales have been only three quarters of what they were in 2019, a sharp downturn after years of soft decline.
While it’s probably the COVID-19 crisis that’s busily putting nails in the chain’s coffin, Chuck E. Cheese has been in trouble since 2012. A merger with LEO Holdings Corporation which would have brought in needed cash and taken the company public fell through in July, 2019, and before that, a company-wide redesign that would ideally have brought in a slightly older clientele flopped due to lack of advertising.
While no one from Chuck E. Cheese has yet commented on the WSJ report, it’s believed that all of the approximately 615 restaurants worldwide are at risk of closure, particularly their mall-based locations, which are often the most expensive to maintain due to high rent.
If Chuck E. Cheese goes down in this time of plague, it won’t be alone. Other big names in business, such as JCPenney, Pier 1 Imports, and J.Crew have all declared bankruptcy in since March of this year, and many more are murmuring of it.
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