Red Lobster, the largest seafood chain in the world, filed for Chapter 11 bankruptcy Sunday in Florida.
The restaurant chain intends “to use the proceedings to drive operational improvements, simplify the business through a reduction in locations, and pursue a sale of substantially all of its assets as a going concern,” according to a press release.
While this may alarm Red Lobster enthusiasts, the chain ensures its restaurants will “remain open and operating as usual during the Chapter 11 process.”
Red Lobster has filed for Chapter 11 protection.
It’s one of the largest restaurant bankruptcies in recent years. https://t.co/EloGOy38Nd
— Axios (@axios) May 20, 2024
“This restructuring is the best path forward for Red Lobster. It allows us to address several financial and operational challenges and emerge stronger and re-focused on our growth,” said company CEO Jonathan Tibus, according to the press release. “The support we’ve received from our lenders and vendors will help ensure that we can complete the sale process quickly and efficiently while remaining focused on our employees and guests.”
The company has reportedly entered into a “stalking horse purchase agreement,” whereby Red Lobster will sell all of its assets to an entity controlled by its current term lenders. (RELATED: ’10 Dead Roaches’: Florida Red Lobster Ordered To Close After Multiple Health Violations)
Red Lobster says it is the largest casual seafood chain in the United States, employing roughly 36,000 workers and serving 64 million customers annually, according to court documents.
A hedge fund bought the company, sold off all the land Red Lobster restaurants are located on, leased the land back to Red Lobster, and jacked the rent. Just so you know what is really going on here https://t.co/kHlbBfRWwN
— Michael McDonald (@ElectProject) May 20, 2024
Red Lobster was founded in 1968 and is headquartered in Orlando, Florida.
