Red Lobster declares bankruptcy, assures restaurants will remain in operation

Red Lobster, the iconic seafood chain, has filed for voluntary Chapter 11 bankruptcy in Florida, marking a significant development for the 56-year-old company. Despite this financial restructuring, Red Lobster has assured customers that its locations will remain open.

The decision to file for bankruptcy comes after the company reported a $76 million loss last year and a 30% decrease in guest count since 2019. In an effort to streamline its operations and improve profitability, Red Lobster plans to sell its business to a new entity owned by its lenders. The company has secured a $100 million financing commitment to support its ongoing operations during this transition.

With nearly 700 locations nationwide, Red Lobster has been a staple in the seafood industry since its founding in 1968. However, the company has faced challenges in recent years, including executive turnover, failed strategic initiatives, and increased competition in the restaurant industry.

CEO Jonathan Tibus emphasized that the bankruptcy filing is a necessary step to address financial and operational challenges and position Red Lobster for future growth. Despite the difficulties, the company remains committed to serving its loyal customers and working with vendors to ensure minimal disruption to its operations.

As Red Lobster navigates this restructuring process, the seafood chain aims to emerge stronger and more focused on its core mission of providing quality seafood dining experiences to millions of customers each year.