Red Lobster moves closer to bankruptcy sale to lenders
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Red Lobster is moving closer to a bankruptcy sale that would put lenders, including Fortress Investment Group, in charge of the company after no other bidders stepped up with an offer to repay the struggling US restaurant chain's debt. Red Lobster filed for bankruptcy in Florida in May with about US$300 million in debt and a plan to close some restaurants and sell itself to its lenders or a higher bidder. The company had planned to conduct an auction on Tuesday, but it received no qualified bids. Without a better offer, Red Lobster will hand over its equity to its lenders in a debt-cancelation deal and continue to operate with fewer locations. Red Lobster entered bankruptcy with about 550 casual dining restaurants in the US and 54 restaurants in other countries. It posted a US$76 million net loss in 2023 and blamed its bankruptcy on high inflation, unsustainable rent costs, and poor management decisions including an "endless shrimp" promotion that caused US$11 million in losses.



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