A huge Wendy's and Pizza Hut franchisee just filed for bankruptcy

The franchisee has been dealing with a perfect storm of problems that led to its Chapter 11 filing on Wednesday, including coronavirus-related shutdowns, a massive debt burden of nearly $1 billion and rising labor and food costs. Pizza Hut, of which NPC is the company's largest franchisee, has also been struggling with sales recently.

NPC's restaurants will continue to operate while it navigates the Chapter 11 process. The company employs nearly 40,000 people in 27 US states, according to its website.

In a statement to CNN Business, Pizza Hut said the filing "was expected" and remains supportive of NPC.

"As NPC works through this process, we support an outcome resulting in an organization with a lower, more sustainable level of debt, ownership focus on operational excellence and a greater level of restaurant investment," a Pizza Hut spokesperson said. The company added that filing will "strengthen the overall health and performance of the entire system for the long term."

Pizza Hut, which is owned by Yum! Brands, pointed toward a recent filing showing that sales at its US restaurants open at least a year have begun rebounding off their March lows. Pizza Hut has 7,100 restaurants in the United States.

NPC operates only a small portion of Wendy's roughly 6,500 US restaurants. Wendy's didn't immediately return request for comment.

NPC is the latest US company to file for bankruptcy during the Covid-19 pandemic. Chuck E. Cheese's parent company, GNC, 24 Hour Fitness, Neiman Marcus, J. Crew all have filed in the past two months.