Sbarro emerged from bankruptcy protection Tuesday.
According to the Associated Press, the pizza chain's $148 million re-organization plan went into effect Monday following a judge's approval May 19.
The company will now relocate headquarters to Columbus, Ohio to cut expenses and work closely with its new entity, Pizza Cucinova. The move cuts 40 positions at the New York style Italian-American cuisine business's former Melville, N.Y. base. It does not impact the company's 2,700 nationwide employess.
Sbarro entered chapter 11 bankruptcy protection for the second time March 10 after attributing its economic struggles to a decrease in foot traffic at the fast food giant's mall locations. The date came one month after the company shuttered 182 of its 400 U.S. locations. This saved the company $82 million according to court documents AP reported.
Sbarro's CEO previously told Reuters that the eatery focused all of its attention on the company's revival.
"The board and senior management team are committed to ensuring Sbarro's future growth and success and today's filing is a necessary step," David Karam said.
A restaurant consultant and president at Baum and Whiteman LLC in Brooklyn, N.Y. told Reuters Sbarro needed a new company strategy.
"Sbarro has been stuck with an outdated business model," Michael Whiteman said. "Its biggest shortcoming is that it sells food that has been sitting out for a while, and more people want food made to order."
Whiteman also said he doesn't think the company can survive on its current business plan, but has taken steps to correct its situation.
"I don't know that it has a sustainable business over the longer term. The way to turn the company around in the short haul is to get out of money-losing leases and close stores, which it has been doing."
The company has 799 restaurants in more than 40 countries. The 582 locations, owned by franchise owners were not affected by the bankruptcy. The initiative gave Sbarro new owners, such as Apollo Global Management, and Babson Captial Management.
