MJP –
Following Thursday’s court approval of its restructuring plan, Red Lobster has now emerged from its Chapter 11 bankruptcy.
The restructuring plan that Red Lobster had filed for was approved by the court on Thursday, enabling the company to emerge from Chapter 11 bankruptcy.
This plan calls for the acquisition of Red Lobster by RL Investor Holdings LLC, an investment firm, before the month’s end.
Damola Adamolekun, formerly of P.F. Chang’s, will replace Jonathan Tibus as CEO in conjunction with this acquisition.
With our new investors, we have a thorough long-term plan that incorporates more than $60 million in fresh capital to revitalize this legendary brand while paying tribute to its heritage,” Adamolekun said, sounding optimistic about the future.
I can’t wait to launch our projects because Red Lobster is going places.
Many patrons resorted to social media to voice their opinions on the restaurant’s bankruptcy as the chain cut its locations to 544.
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Rumor has said that Red Lobster is contemplating a Chapter 11 petition, according to one X user, and “Only in America could we eat Red Lobster into bankruptcy,” according to another.
The corporation is, I suppose, in a sticky situation.
Customers were more hesitant to spend during the recession, which led to a precipitous decline in business for Red Lobster.
In an attempt to increase everyday traffic and win over more regular customers, the company launched an uncontrollable promotion: $20 for all the shrimp you could eat.
An $11 million quarterly loss was recorded last November as a result of this low pricing, which was disappointing and did not produce the desired effects.
Although the promotion was appealing, it couldn’t be sustained because of the large amount of high-quality seafood served at such a low price. The boost in traffic wasn’t enough to compensate for the losses.
