Toronto-based pizza company General Assembly is no longer selling its frozen pizzas.
General Assembly, which is publicly traded on the TSX Venture Exchange, is selling its frozen pizza business to Piano Piano, a private Italian restaurant also located in Toronto.
General Assembly plans to expand its restaurant business “while continuing to be realistic … given prevailing market conditions.”
General Assembly started out as a fast-casual pizza restaurant in Toronto in 2017. As many other businesses did during the pandemic, General Assembly pivoted to adapt to the operational restrictions brought on by COVID-19 and experimented with new business models.
After a recent review of its operations, General Assembly said it decided to sell its frozen pizza line, which has been experiencing a decline in sales over the past year. For the nine months ended in September 2022, General Assembly reported $1.8 million in revenue for its frozen pizza business, which represents a 42 percent decline year-over-year, when it made $3.1 million.
General Assembly said the sale will allow it to focus on its restaurant business, which it claimed has now fully returned to pre-pandemic performance. General Assembly said the decision to sell its frozen pizza line was also made in part due to a tough fundraising environment for companies.
General Assembly has raised multiple rounds of funding in the past, including its initial public offering on the TSX Venture Exchange after it pivoted to subscription and frozen sales, as well as a $13 million CAD Series A round in 2021 which was led by Gravitas Securities.
The company’s stock price saw a 94 percent decline over the past year, currently trading at three cents. General Assembly’s shares were priced at $0.50 cents each last year.
General Assembly also went through significant leadership changes in December 2022 when founder Ali Khan departed from his role as CEO to become president of the company. Hormis Tharakan, who was General Assembly’s COO, left the company to pursue other opportunities.
According to General Assembly, the sale of its frozen pizza business removes substantial debt and financial obligations, providing “meaningful relief” to its balance sheet. As part of the acquisition, Piano Piano is assuming $2.98 million of General Assembly’s debt owing to “certain arm’s length creditors,” which were not disclosed, and made up of other liabilities of the company.
Certain employees of General Pizza’s frozen pizza operations were also offered employment with Piano Piano, which has been granted the right to continue selling the frozen pizzas under General Assembly’s brand.
For the next couple of months, General Assembly said it plans to expand its restaurant footprint “while continuing to be prudent and realistic … given prevailing market conditions and the current rebuilding of the company’s financial profile.”
Featured image courtesy General Assembly.