Red Lobster files for chapter 11 bankruptcy after closing multiple locations

Red Lobster, a popular seafood restaurant chain, recently filed for chapter 11 bankruptcy. This happened shortly after closing down several of its locations across the country. The company made this decision to improve its operations, reduce the number of locations, and sell off all its assets. Despite the bankruptcy, Red Lobster will continue to operate normally during the process. The CEO of Red Lobster, Jonathan Tibus, mentioned that this restructuring is necessary for the company to overcome financial and operational challenges and come out stronger. The company has received support from its lenders and vendors to ensure a quick and efficient sale process while focusing on its employees and customers. Red Lobster has entered into a purchase agreement that will lead to the sale of the company to a business owned by its lenders. The company secured a $100 million commitment from its lenders to keep operating during the bankruptcy proceedings. Court documents revealed that Red Lobster has over $1 billion in debt but only $30 million in cash. Established in 1968 in Lakeland, Florida, Red Lobster was initially owned by General Mills before becoming part of Darden Restaurants, Inc. in 1995. In 2014, Red Lobster became independent from Darden, which also owns Olive Garden and Longhorn Steakhouse. The company has faced financial difficulties in recent years. Red Lobster currently has 551 locations in the U.S., 27 in Canada, and 27 franchised restaurants in Mexico, Ecuador, Japan, and Thailand. The sudden closure of more than 50 locations last week fueled speculations about the company's financial troubles.