- Crimson Lobster might file for Chapter 11 chapter safety subsequent week, per The Wall Avenue Journal.
- The restaurant chain, burdened with a whole lot of hundreds of thousands in debt, not too long ago shut down 52 shops.
- Crimson Lobster blamed a few of its monetary struggles on an all-you-can-eat shrimp promotion.
Restaurant chain Crimson Lobster might file for chapter safety as early as subsequent week, The Wall Avenue Journal reported on Tuesday.
Individuals accustomed to the matter instructed the Journal that the corporate, overwhelmed with a whole lot of hundreds of thousands in debt, plans to file a Chapter 11 chapter petition in Orlando earlier than Memorial Day.
Bloomberg beforehand reported in April that the restaurant firm was contemplating submitting for Chapter 11 chapter safety.
The chapter information comes after Crimson Lobster, which has round 650 places, shut down over 50 places throughout the US, restaurant liquidator TAGeX Manufacturers confirmed to Enterprise Insider on Monday.
States that may see Crimson Lobster closures embrace California, Colorado, Florida, New York, and Texas.
Over the previous few years, monetary troubles have beset the favored seafood chain.
Leasing prices, much less foot visitors throughout COVID-19 lockdowns, and a failed all-you-can-eat shrimp promotion are a few of the causes Crimson Lobster and outdoors observers have attributed to the corporate’s downfall.
These monetary troubles resulted in Thai Union Group, which had assumed majority possession of Crimson Lobster in 2020, pulling out its investments. On a February earnings name, Thai Union Chief Govt Thiraphong Chansiri mentioned, “We’ll exit. We’re not going to inject any extra money into Crimson Lobster.”
“The mixture of the Covid-19 pandemic, sustained trade headwinds, greater rates of interest, and rising materials and labor prices have impacted Crimson Lobster, leading to extended detrimental monetary contributions to Thai Union and its shareholders,” Chansiri beforehand mentioned.
Crimson Lobster and Thai Union Group didn’t instantly reply to a request for remark from BI.
