Popular casual dining restaurant TGI Fridays has recently filed for Chapter 11 bankruptcy in Texas, following ongoing financial struggles stemming from the COVID-19 pandemic.
According to executive chairman Rohit Manocha, the company hasn’t recovered from the impact the pandemic caused, and the filing is necessary to protect the investments and employees.
“The next steps announced today are difficult but necessary actions to protect the best interests of our stakeholders, including our domestic and international franchisees and our valued team members around the world,” Manocha said in a statement. “The primary driver of our financial challenges resulted from COVID-19 and our capital structure.”
Additionally, the company hopes to use the restructuring period and the legal protections from the Chapter 11 filing to find strategic alternatives to help the food chain maintain its business.
“This restructuring will allow our go-forward restaurants to proceed with an optimized corporate infrastructure that enables them to reach their full potential,” Manocha added.
In recent months, TGI Fridays closed 12 restaurants in the U.S. and 35 internationally. In January, 36 underperforming U.S. locations were shuttered, and eight corporate-owned locations were sold to former CEO Ray Blanchette. Nonetheless, despite the filing, the company has assured customers that 39 of its corporate-owned U.S. locations, in addition to its international locations, would remain open.
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