The iconic seafood chain Red Lobster filed for Chapter 11 bankruptcy in Florida, following a series of financial challenges, including $294 million in debt. Despite being the largest seafood restaurant chain in the U.S. with 551 stores in 44 states, the company had to close nearly 100 locations scattered across the country. A substantial number of kitchen equipment from these closed locations is now up for auction on a restaurant liquidator’s site, indicating a significant downsizing for the company.
Red Lobster intends to use the bankruptcy proceedings to implement operational improvements, simplify its business by reducing locations, and pursue a sale of the majority of its assets. The company announced that its business will be sold to a new entity owned and controlled by its lenders. Amid the bankruptcy process, all Red Lobster restaurants will continue to remain open. As a result, each of the temporarily closed locations has been listed on the Red Lobster website, providing detailed information for customers who may be impacted by the closures.
Thai Union Group, based in Thailand, has been the largest shareholder of Red Lobster since 2020, owning 49% of the company. Prior to this, Darden Restaurants sold off Red Lobster to private equity firm Golden Gate Capital in 2014 for approximately $2.1 billion. The partnership with Thai Union Group and the restructuring efforts during the bankruptcy proceedings aim to steer Red Lobster towards a path of financial recovery and operational stability.
