TGI Fridays files for bankruptcy, the COVID-19 pandemic blamed for financial difficulties
TGI Fridays CEO Brandon Coleman III reacts to McDonalds reportedly increasing its franchise revenue for the first time in 30 years on The Claman Countdown.
Casual restaurant chain TGI Fridays Inc. filed for Chapter 11 bankruptcy in Texas on Saturday with the company’s chief executive saying it still hasn’t fully recovered from the COVID-19 pandemic.
The bar and grill chain, known for serving hamburgers, loaded potato skins and $5 happy hour drinks, said the move was made to “address legacy debt and position the restaurants for long-term success,” the company said in a press release.
The Dallas-based company says its 39 corporate-operated restaurants will remain open. TGI Fridays is short for “Thank God it’s Friday.”
TGI FRIDAYS IS CLOSING TEN STORES IN AMERICA IN JUST ONE MONTH
TGI Fridays has closed its longtime restaurant on Route 38 in Cherry Hill. (Jim Walsh/Courier-Post / USA TODAY NETWORK via Imagn Images / IMAGN)
In addition, the company has sold 56 franchises in 41 countries. All of these franchise locations, domestic and international, are independently owned and therefore not included in the TGI Fridays Chapter 11 filing, the company said.
The company says it expects to use the time and legal protections made available through the Chapter 11 restructuring process to explore other strategic options to ensure the long-term viability of the brand.
“The next steps announced today are tough but necessary steps to protect the interests of our stakeholders, including our local and international shareholders and our valued team members around the world,” TGI Fridays Inc chief executive Rohit Manocha said in a statement.
RED LOBSTER ENDLESS SHRIMP DEAL CAUSED ‘A LOT OF CHAOS,’ NEW CEO PARTS THROUGH ATTACK
A closed TGI Fridays store in Princeton, New Jersey (Getty Images / Image Image / Getty Images)
“The primary driver of our financial challenges is due to COVID-19 and our capital structure. This restructuring will allow our flagship restaurants to continue with an improved business infrastructure that enables them to reach their full potential.”
The company says it has committed to debt financing to support operations while it goes through the Chapter 11 process.
The TGI Fridays brand and related intellectual property are not included in the Chapter 11 filing because of an ownership assurance agreement with a separate group of investors, the company said.
The company closed 12 US locations and closed 35 restaurants overseas in recent weeks.
In January, the brand closed 36 “underperforming” restaurants across the US, saying it was part of a long-term growth strategy to ensure efficiency.
READ MORE ON FOX BUSINESS
Image of the TGI Fridays sign in New York (Photos by Bruce Bennett/Getty Images)
It also sold eight of its company-owned restaurants to former CEO Ray Blanchette that month, with the company adding that this “period of transition” will help drive revenue for the chain.
TGI Fridays has been serving its customers for over 50 years.
The company says it currently operates more than 461 restaurants in 41 countries that offer “high-quality, classic American cuisine and popular beverages backed by authentic and authentic service.”
Fox News’ Kristen Altus and Daniella Genovese contributed to this report.
Source link
