Red Lobster files for bankruptcy, but restaurants will stay open
The largest seafood chain in the U.S. has been unable to regain its financial footing following the pandemic
The seafood chain has struggled since the pandemic, closing 99 stores amid sluggish sales
Red Lobster has filed for voluntary Chapter 11 bankruptcy in Florida, the company confirmed in a statement late Sunday night — but it intends to keep its locations open.
The 56-year-old seafood chain, the largest of its kind in the U.S., said it would "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."
The company said it lost $76 million last year and had seen a 30% drop-off in guest count since 2019.
As part of its reorganization, Red Lobster has agreed to sell its business to a new entity wholly owned and controlled by its lenders, a so-called stalking horse arrangement. The company said it had received a $100 million financing commitment to fund ongoing operations.
https://www.nbcnews.com/news/amp/rcna152437
