The versatile and resilient lobster survives by molting, shedding its skin and growing into a new, larger shell. But at some point the energy runs out and the transformation becomes more difficult.
Red Lobster, one of America’s best-known mussel ambassadors, has reached this stage in its life cycle: The once-ubiquitous restaurant chain filed for Chapter 11 bankruptcy protection on Sunday after more than half a century as the country’s leading seafood franchise.
In court filings, the company said it had more than 100,000 creditors and liabilities ranging from $1 billion to $10 billion. Red Lobster said it plans to reduce its locations as it prepares to sell most of its assets. In the meantime, remaining Red Lobster restaurants will remain open.
It was a painful, slow end for Red Lobster, whose death throes became clear earlier this year when the company reportedly tried to restructure its debt. After decades as a subsidiary of General Mills, Red Lobster was bought by a private equity firm in 2014 and bolstered by an investment from a Thai seafood conglomerate in 2020. But the company has faced challenges in the years since the coronavirus pandemic as industry headwinds, rising costs and changing eating habits forced the company to close underperforming locations.
Thai seafood company Thai Union Group announced in January that it was exiting its investment in Red Lobster. Last week, dozens of Red Lobster locations began selling assets through a liquidator, offering the spoils of a crumbling restaurant dynasty such as industrial freezers, lobster tanks and bar equipment (alcohol not included).
In its heyday, Red Lobster had achieved a coveted status among suburban restaurants: affordable enough to be accessible, chic enough to be sophisticated. Although the chain was founded in Orlando, Florida, it drew heavy inspiration from Bar Harbor, a tourist destination off Maine’s rocky Atlantic coast.
Over the course of its 56-year existence, Red Lobster has experienced a variety of reinventions. Originally known as an oyster lounge and cocktail bar in the 1960s and 1970s, Red Lobster evolved in later years into a family-friendly restaurant that was an introduction to the world of seafood for many.
It may have reached its peak in cultural awareness with a mention from Beyoncé, who mentioned the restaurant by name in her 2016 song “Formation” and just as quickly descended. Last year, the chain encountered an all-you-can-eat shrimp offering that was so popular with diners that it caused the company to report a quarterly loss of $11 million.
“This restructuring is the best path forward for Red Lobster,” Jonathan Tibus, the company’s chief executive, said in a statement Sunday. “It allows us to address various financial and operational challenges and emerge stronger and refocus on our growth.”
Red Lobster did not immediately respond to a request for comment.
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2024-05-20 14:07:31
www.nytimes.com
