A bankruptcy court approved Red Lobster\u2019s plan to exit Chapter 11, putting the seafood chain one step closer to exiting bankruptcy.<\/p>\n
The company, known for its seafood offerings and cheddar biscuits, filed for bankruptcy protection in May. Red Lobster had struggled with increased competition, expensive leases, last year\u2019s disastrous shrimp promotion and a broader pullback in consumer spending.<\/p>\n
As part of the restructuring plan, a group of investors under the name RL Investor Holdings will acquire Red Lobster by the end of the month. Once the acquisition closes, former P.F. Chang\u2019s CEO Damola Adamolekun will step in to lead Red Lobster. Current CEO Jonathan Tibus, who led the company through bankruptcy, will leave Red Lobster.<\/p>\n
\u201cThis is a great day for Red Lobster,\u201d Adamolekun said in a statement. \u201cWith our new backers, we have a comprehensive and long-term investment plan \u2014 including a commitment of more than $60 million in new funding \u2014 that will help to reinvigorate the iconic brand while keeping the best of its history.\u201d<\/p>\n
RL Investor Holdings includes TCW Private Credit, Blue Torch and funds managed by affiliates of Fortress Investment Group. Red Lobster will operate as an independent company.<\/p>\n
After slimming down its restaurant portfolio, the chain currently operates 544 restaurants across the U.S. and Canada.<\/p>\n
At least nine other restaurant chains have filed for bankruptcy this year. High interest rates and a pullback in consumer spending have weighed on eateries, particularly if they were already struggling to bounce back from the pandemic.<\/p>\n<\/p>\n
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