A paper company in Italy has said it will close its Italian-style restaurant, Papa Ginos, as the company struggles to cope with a slump in sales and an ongoing crackdown on cigarette and tobacco use.
In a statement, Papa Genoa said it would lay off 6,000 employees and close its four restaurants in Rome, Naples and Bologna.
The news comes as the Italian government has cracked down on cigarette smuggling, banning new tobacco product shipments into Italy, and the number of people smoking in the country has plummeted to the lowest level in two decades.
The closures will affect the roughly 1,400 restaurants in Italy that serve alcohol, as well as the more than 2,500 outlets where people can buy tobacco products.
The closure of the restaurants will also affect the company’s Italian-inspired coffee, tea and snacks, the statement said.
The company’s owners, a group of Italian business executives led by the brothers Gianni and Giovanni Gino, had been exploring a sale of the Italian business after the government imposed new restrictions on the importation of tobacco products in December, including bans on the sale of new products.
‘The decision was taken at the highest levels, to protect the business’ “The decision is in line with the current climate,” Gianni Gino said in a statement.
“It is the most important thing for the future of the business, to have the best possible situation to succeed and to protect its shareholders, who have invested a great deal.”
The announcement comes as Italian authorities are cracking down on the smuggling of tobacco product into the country, including banning new shipments.
Italy’s new laws have been criticised by some in the industry as a move to reduce competition.
Last week, the government announced it was suspending the import of the cigarette and nicotine product Marlboro brand, which it said was used in many of the restaurant chains, including Papa Ginnas.
However, the ban was not retroactive.
The ban on the Marlobes was lifted in January, and sales of cigarettes and nicotine products increased in the last months of the year, according to the company.
However this has led to a decline in sales, and a reduction in the companys share price.
In May, Papa Giovanese announced it would close the Italian-styled pizzeria in the city of Bolognese, the only Italian-themed pizzeria on the island of Lampedusa.