Between financial hemorrhage and legal troubles, can Mamma Roma still recover?

Belgian chain Mamma Roma, once iconic for its Roman-style pizzas, is showing financial health that casts doubt on its operations, according to the financial daily L'Echo . This catastrophic situation is compounded by a criminal complaint for forgery, use of forged documents, false balance sheets, and attempted fraud, which minority shareholders intend to file.

In the space of a year, the brand closed its loss-making restaurants: two in Ghent, one in Antwerp, as well as its Brussels establishments in the Châtelain district and Place Sainte-Catherine. Now, only two pizzerias remain out of seven. It must be said that Mamma Roma has never made a profit since the publication of its first annual accounts in 2008. But it has accumulated €35 million in carried forward losses. "A colossal amount" for a company of its size, details L'Echo , especially since the company has €20 million in negative equity.

This means that Mamma hasn't been making money for a long time. Or that shareholders have withdrawn funds from its accounts. To the point that selling all the assets it owns wouldn't be enough to resolve the situation. However, when the net assets are less than half the capital, a general meeting must decide on the dissolution of the company or on measures to ensure its continuity, according to the Companies Code.

On life support from its shareholders

Since 2010, Mamma Roma has maintained itself through capital increases. About fifteen, according to the company's amended articles of association, for a total amount of approximately 17 million euros. Management has indeed initiated a "restructuring" plan, with restaurant closures being a consequence.

Surprisingly, entrepreneur Frédéric de Gaiffier, the latest CEO to join the recent wave of managers (four in four months) seeking to right the ship, puts the situation into perspective by discussing with La Libre the Iberian expansion plans for the Mamma Roma factory in Gembloux. The production site, which employs 30 of the 36 employees, supplies retail clients as well as foodservice players such as Exki and Le Pain Quotidien. For pizzerias, however, there are no specific prospects.

Judicial escalation

Meanwhile, L'Echo points out that a legal battle between shareholders, which has been ongoing since 2017, the date of an aborted merger between Mamma Roma and Dr Oetker, could lead the parties to criminal proceedings: a trio of minority shareholders (holding 34% of the capital) accuse the majority shareholders, led by a former director of AB InBev, Charles Adriaenssen (>45%), successor by alliance of the brewing group, of having conveniently falsified the accounts.

Minority shareholders denounce a serious lack of transparency and governance at Mamma Roma. Although management is resolutely optimistic about the company's future, they deplore the fact that no five-year recovery plan has been communicated. Finally, after the failure of mediation, the "small" shareholders are now demanding the appointment of a court-appointed receiver.