CHICAGO (CBS/WBBM) – Chicago-based Giordano’s Pizza has filed for Chapter 11 bankruptcy protection, but wants to keep the business running during its reorganization.
The chain, known for its stuffed pizza, owes nearly $46 million to Fifth Third Bank, its main lender, according to this week’s bankruptcy filing.
As WBBM Newsradio 780′s Keith Johnson reports, Giordano’s failed to make a Jan. 1 loan payment, which forced its lender to declare a loan default.
LISTEN: Newsradio 780′s Keith Johnson reports
Crain’s Chicago Business reports 38 debtors rushed in to keep their accounts active. Giordano’s and the debtors convinced a judge to authorize payroll and vendor payments.
Giordano’s is said to have several loans, most of them used to buy real estate.
Giordano’s was founded in 1974 by Italian immigrants Efren and Joseph Boglio. It is credited with being one of the creators of stuffed pizza.
The pizzeria was named after the Boglio brothers’ mother. Efren Boglio told Chicago Magazine in an excerpt posted on Giordano’s Web site: “Of all (my mother’s) repertoire… my family was most fond of her deep-dish, double-crusted pizza, which she made on Easter and stuffed with ricotta cheese.”
John and Eve Apostolou now own the pizza chain. Michael Gesas, an attorney for the debtors tells Crain’s that the pizza business is very healthy, and this case is about the real estate market collapse.
The company runs stores in the Chicago area, four joint-venture locations and 35 franchised restaurants. The chain also sells frozen pizzas for overnight delivery.
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