June 15, 2024

Eating places

Pink Lobster stated it is going to use the chapter proceedings to simplify its operations, shut eating places, and pursue a sale.

Jeff Chiu / AP, File

Pink Lobster, the informal eating chain that gained followers with innovations like popcorn shrimp and “limitless” seafood offers, has filed for Chapter 11 chapter safety.

The 56-year-old chain made the submitting late Sunday, days after shuttering dozens of eating places.

“This restructuring is the most effective path ahead for Pink Lobster. It permits us to deal with a number of monetary and operational challenges and emerge stronger and re-focused on our progress,” stated Pink Lobster CEO Jonathan Tibus, a company restructuring professional who took the highest publish on the chain in March.

Pink Lobster stated it is going to use the chapter proceedings to simplify its operations, shut eating places and pursue a sale. As a part of the filings, Pink Lobster has entered right into a so-called “stalking horse” settlement, which means it plans to promote its enterprise to an entity fashioned and managed by its lenders.

The Orlando, Florida-based chain was based by Invoice Darden, who needed to make seafood eating places extra accessible and reasonably priced for households. Darden bought Pink Lobster to Normal Mills in 1970. Normal Mills later went on to kind Darden Eating places, which owns Olive Backyard and different chains, and spun the corporate off in 1995.

Lately, Pink Lobster has been combating rising competitors from quick informal chains like Chipotle in addition to rising lease and labor prices. Its all-you-can eat offers for shrimp and lobster additionally turned more and more costly.

Final fall, Pink Lobster misplaced hundreds of thousands of {dollars} on its Final Countless Shrimp promotion, which charged $20 for all-you-can-eat shrimp deal.

“We knew the value was low-cost, however the thought was to convey extra site visitors within the eating places,” Ludovic Garnier, the chief monetary officer of Thai Union Group, Pink Lobster’s former co-owner, stated in an earnings name with traders.

Garnier stated the deal did work, and restaurant site visitors elevated. However extra friends opted for the $20 deal than Pink Lobster anticipated, Garnier stated, including “we don’t earn some huge cash at $20.” For the primary 9 months of 2023, Thai Union Group — which is among the world’s largest seafood suppliers — reported a $19 million share of loss from Pink Lobster.

In January, Thai Union Group introduced its intention to exit its minority funding in Pink Lobster. CEO Thiraphong Chansiri stated the COVID-19 pandemic, business headwinds and rising working prices had hit the eating chain onerous and triggered “extended unfavourable monetary contributions to Thai Union and its shareholders.”

Thai Union Group first invested in Pink Lobster in 2016 and upped its stake in 2020.

Restaurant liquidator TAGeX Manufacturers introduced final week that it might be auctioning off the gear of over 50 Pink Lobster areas that had been just lately closed. The shop closures span throughout greater than 20 states — decreasing Pink Lobster’s presence in cities like Denver, San Antonio, Indianapolis and Sacramento, California.

The seafood restaurant chain stated in a courtroom submitting that it has greater than 100,000 collectors and estimated property between $1 billion and $10 billion. The corporate’s estimated liabilities are between $1 billion and $10 billion.

Pink Lobster operates 700 areas worldwide.