USA – Casual dining restaurant chain TGI Froday’s has filed for Chapter 11 of the US Bankruptcy Code in the Northern District of Texas amid financial struggles.
According to Reuters, the company has listed assets and liabilities ranging between US$100 million and US$500 million in its recent court filing.
Despite current financial challenges, TGI Friday’s continues to operate 39 domestic locations and has pledged to protect these restaurants and support their ongoing operations through debtor-in-possession financing.
While the company’s list of top 23 creditors does not include seafood suppliers or distributors, some of these parties are anticipated to file claims, given that seafood appetizers and entrees are a prominent part of the menu.
Executive Chairman Rohit Manocha attributed the company’s financial difficulties primarily to the impact of COVID-19 and its capital structure.
He stated that the restructuring would enable the remaining restaurants to function with a more optimized corporate framework, allowing them to reach their full potential.
In a significant development in 2023, British restaurant operator Hostmore withdrew its bid to acquire TGI Friday’s after being removed as the manager of TGIF Funding.
This led to a 90% drop in Hostmore’s share value, ultimately resulting in the company’s announcement of plans to enter administration due to mounting debt.
Following these challenges, Thursdays (UK), which operated TGI Friday’s in the UK, closed 35 locations in October 2024, resulting in 1,012 job losses.
However, TGI Friday’s confirmed after its bankruptcy filing later that month that normal operations would continue at all U.S. and international franchise locations.
TGI Friday’s Franchisor, which owns the brand and intellectual property, has franchised the chain to 56 franchisees across 41 countries.
These independently owned stores are not part of the Chapter 11 proceedings. The chain announced the filing shortly after closing 50 U.S. locations, highlighting a period of instability within the restaurant sector.
This year has seen several restaurant chains, including Red Lobster and Buca di Beppo, filing for bankruptcy as inflation pressures lead consumers to reassess their spending habits.
TGI Friday’s, an iconic American chain since the opening of its first bar in Manhattan, New York, in 1965, is privately held by TriArtisan Capital Advisors.
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