Around 1,500 jobs are likely to be lost after the owners of Chiquito restaurant chain moved to put it into administration.
The Restaurant Group, which also owns Wagamama and Frankie & Benny’s, is struggling to cope with the fallout from the coronavirus outbreak on the business.
It said it would also shut its Food and Fuel chain of pubs in London.
Around 1,500 jobs are likely to be affected and the move comes less than a week after the company said sales plummeted 12.5% over two weeks.
A total of 60 Chiquito sites will remain shut.
A spokesman said: “Covid-19 has had an immediate and significant impact on trading across the Group.
“We have conducted a review of the performance of our business divisions, with a particular focus on the expected future cash generation profile of each of our business units.”
He added that both groups are expected to hit losses this year, “as a result, the Group has taken the very difficult decision to appoint administrators for Food & Fuel Limited and filed a notice of intention to appoint an administrator for Chiquito Limited.
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“The decisions have been incredibly difficult and we recognise the significant impact on all of our colleagues that are affected. We thank them for their hard work and commitment during these very testing times.”
Pubs and restaurants have faced a tough week, with the Government announcing their closure, although takeaway services are allowed to continue.
Marston’s, which runs 1,400 pubs across the country, and Mitchells & Butlers, the owner of Toby Carvery and All Bar One also both warned they were struggling.
Carluccio's brings in advisers ahead of possible administration
Fellow restaurant chain Carluccio’s has brought in financial advisers to look at putting the company into administration in a move that could affect another 2,000 workers.
FRP Advisory confirmed it had been appointed by Carluccio’s with all options open. News agency PA said it was understood that with all sites shut due to coronavirus a collapse is most likely.
A spokesman for the advisers said: “FRP is working with the directors of Carluccio’s to consider all options for the company in the current climate.”
Dave Turnbull, Unite national officer for the hospitality sector, said: “If Carluccio’s does enter administration Unite will ensure that our members receive their unpaid wages, redundancy, notice and holiday pay.
“Unite will also be looking at making a protective award on behalf of our members for a failure to consult.”