Argentine empanada and pizza chain owner enters creditor protection

Divaflo, the Argentine company operating popular empanada and pizza chains including Morita, Kiosco de Empanadas, Fábrica de Pizzas, and Solo Empanadas, has filed for creditor protection. This move signals a significant downturn for the businesses, which have been struggling amid a broader crisis in consumer spending.

The company's filing was approved by the Civil and Commercial Court No. 11 of General San Martín. Creditors have until September 14 to verify their claims. The judicial timeline includes a report on individual credits in October and a key informational hearing in June 2027. Divaflo has until July 1, 2027, to negotiate with creditors, propose an agreement, and secure the necessary approvals to avoid bankruptcy.

Divaflo's financial situation has been deteriorating, with debts exceeding $3845 million to financial institutions, according to the Central Bank of Argentina. Furthermore, the company has a history of 231 rejected checks totaling over $1032 million, with only one having been paid.

This current predicament stands in stark contrast to the company's ambitious expansion efforts in 2017, when Divaflo acquired Solo Empanadas. At the time, the goal was to revitalize the brand and leverage its recognition for group growth, with plans to open 30 new locations. The strategy included aggressive pricing and a "Solo Segundos" (Solo Seconds) sales model, inspired by Little Caesars' Hot-N-Ready concept, offering pre-made empanadas for immediate pickup. This expansion was intended to complement the growth of Fábrica de Pizzas and Kiosco de Empanadas, which were also expanding through franchises.