Red Lobster, a well-known restaurant chain, is facing financial difficulties and may file for Chapter 11 bankruptcy protection in the near future. The company has accrued hundreds of millions of dollars in debt, which has led to its recent closure of 52 stores across the US. Some industry experts have attributed the challenges faced by Red Lobster to a failed all-you-can-eat shrimp promotion.
Red Lobster locations in California, Colorado, Florida, New York, and Texas will see closures as the company seeks ways to address its financial troubles. Leasing costs, decreased foot traffic during COVID-19 lockdowns, and other factors have contributed to the chain’s downfall. Thai Union Group, which assumed majority ownership of Red Lobster in 2020, has decided to pull out its investments in the company.
During an earnings call, Thiraphong Chansiri, CEO of Thai Union Group, announced that they would no longer be investing in Red Lobster. The impacts of the COVID-19 pandemic, industry challenges, higher interest rates, and increased costs have all played a role in Red Lobster’s financial struggles. Both Red Lobster and Thai Union Group have yet to comment on the news of the potential bankruptcy filing.
