Endless shrimp did not cause Red Lobster to file for bankruptcy
A series of financial problems including $294 million in debt has lead seafood giant Red Lobster to file for bankruptcy.
Red Lobster is exiting Chapter 11 bankruptcy after a federal judge on Thursday approved the seafood restaurant chain’s plan to rebound from an “endless shrimp” fiasco, massive debt, dozens of location closures and an overall decline in guests.
It’s been just over two months since Red Lobster announced it filed for bankruptcy but hundreds of locations are still open across the country and serving up their cheddar bay biscuits and plenty of shrimp – just maybe not so endless.
Less than four months after the seafood chain first began closing locations, Red Lobster will continue operating as an independent company and will maintain 544 restaurants across 44 U.S. states and four Canadian provinces.
As part of Red Lobster’s Chapter 11 plan, RL Investor Holdings LLC − a newly formed entity organized and controlled by Fortress Investment Group LLC − will acquire the restaurant chain. The acquisition is expected to be completed by the end of the month, Red Lobster said in a news release.
Red Lobster will be Fortress’ most recent acquisition of a company that has filed for bankruptcy, following the purchases of Vice Media and the Alamo Drafthouse, which has since been sold to Sony Pictures Entertainment.
In May, Red Lobster filed for Chapter 11 bankruptcy in Florida amid 48 restaurant closures. By the end of the month, closures had doubled to a total of 99, including 10 in Texas.
But those restaurants represent just about 15% of the 641 restaurants that were open for business as the year started. USA TODAY has collected the addresses of every Red Lobster location and whether the website says the restaurants are open or closed.
The following graphic represents how many Lobsters each state has, as well as how many of those are listed as closed.
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What’s striking about the map above is how Red Lobsters dot the country and are almost numerous enough to create the shapes of a few states. The seafood chain, founded in 1968, is the largest in the U.S., with more than 500 locations in 44 states, based on locations reported on their website.
Red Lobster is based out of Florida, which currently has 42 locations still in operation. Despite 10 closures, Texas still claims more restaurants than Florida.
According to Red Lobster, the company intends to use the bankruptcy proceedings to “drive operational improvements, simplify the business through a reduction in locations, and pursue a sale of substantially all of its assets.”
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LIST: Which Texas Red Lobsters are closed? Which are still open?OPENAbilene: 1280 S Clack StreetAmarillo: 3311 I-40 WArlington: 4233 S. Cooper StreetAustin: 3815 S. Lamar Blvd. and 109 W. Anderson LaneBrownsville: 1075 FM 802Burleson: 1175 N. Burleson Blvd.Conroe: 2944 Interstate 45 NCorpus Christi: 5825 South Padre Island DriveDenton: 2801 S I-35 EDuncanville: 603 N Cockrell Hill RoadEl Paso: 800 Sunland Park Drive, 8401 Gateway Blvd. West and 1860 Joe Battle Blvd.Fort Worth: 4805 S. Hulen StreetFrisco: 3056 Preston RoadGreenville: 7601 Wesley StreetHouston: 13232 NW Freeway and 2760 S. Highway 6Humble: 20414 US Highway 59 NIrving: 4205 W. Airport FreewayKaty: 25408 Bell PatnaKilleen: 1001 E Central Texas ExpresswayLaredo: 5315 San Dario Ave.Lewisville: 2497 S Stemmons FreewayLubbock: 5034 50th StreetMcAllen: 701 West Expressway 83 and 7617 N 10th StreetMesquite: 3906 Towne Crossing Blvd.North Richland Hills: 7800 Bedford-Euless RoadOdessa: 4536 E. University Blvd.Plano: 3501 Central ExpresswayRound Rock: 2702 A Parker RoadSan Antonio: 1381 SW Loop 410, 4550 NW Loop 410, 8210 I-H 35 North and 5815 N. Loop 1604 WestSan Marcos: 100 N IH 35Shenandoah: 18446 Interstate 45 SSherman: 3600 N Highway 75Texarkana: 3002 Saint Michael DriveWaco: 5925 West Waco DriveWebster: 888 W. Bay Area Blvd.Wichita Falls: 4401 Kemp Blvd.CLOSEDDallas: 10290 Technology BlvdDallas: 9069 Vantage Point DriveHouston: 302 FM 1960 Road WLake Jackson: 104 Highway 332 WLongview: 3515 McCann RoadLufkin: 1919 S. First StreetPasadena: 4002 Spencer HighwaySan Antonio: 7835 Interstate 35 S, 17415 US 281 NTyler: 1500 WSW Loop 323Victoria: 7404 Zac Lentz ParkwaySearch for your Red Lobster locationWhy is Red Lobster closing?
In an April 2024 Bloomberg report citing sources familiar with the discussions, Red Lobster was considering a bankruptcy filing to renegotiate burdensome leases and address other long-term contracts, as well as rising labor costs.
The seafood chain has been finding it difficult to make money with its current leases and labor costs. CNN also reported that the company suffered a $12.5 million operating loss in the fourth quarter of 2023, despite its “Ultimate Endless Shrimp” promotion.
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Who owns Red Lobster restaurants?
Thai Union Group − which is based in Thailand − has been the largest shareholder since 2020, owning 49% of the company. Darden Restaurants originally sold off Red Lobster to private equity firm Golden Gate Capital in 2014 for about $2.1 billion.
Red Lobster was founded in Lakeland, Florida in 1968.
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Publish date : 2024-09-06 03:53:00
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