OAN Staff James Meyers
7:23 AM – Thursday, September 12, 2024
BurgerFi filed for Chapter 11 bankruptcy on Wednesday, joining other restaurant chains that have already made the financial move.
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In a statement, the company said it filed for Chapter 11 reorganization to “preserve the value” of its BurgerFi and Anthony’s Coal Fired Pizza & Wings brands “for all stakeholders.”
However, only its corporate-owned BurgerFi and Anthony’s Coal Fired Pizza & Wings restaurants are included in the bankruptcy proceedings, it said.
The burger chain filed in the U.S. Bankruptcy Court for the District of Delaware.
Chief Restructuring Officer Jeremy Rosenthal said the company’s need to file for Chapter 11 increased amid a “drastic decline in post-pandemic consumer spending amidst sustained inflation and increasing food and labor costs,” according to a press release.
The move comes after BurgerFi began a major overhaul effort last year.
CEO Carl Bachmann said “legacy challenges” also “necessitated today’s filing” despite the company having seen “early positive indicators of the turnaround plan initiated less than a year ago.”
Additionally, in its filing, the burger chain estimated a range of $50-$100 million for its assets, with estimated liabilities coming in at a range of $100-$500 million.
The company was also “confident” that the bankruptcy process “will allow us to protect and grow our brands and to continue the operational turnaround started less than 12 months ago and secure additional capital,” according to Rosenthal.
Meanwhile, customers should expect corporate and franchised restaurants to remain open, according to BurgerFi. Franchisees operate 76 BurgerFi restaurants and one Anthony’s location.
BurgerFi joins the likes of Buca Di Beppo, Roti, Rubio’s Coastal Grill, Red Lobster and Tijuana Flats who have all filed Chapter 11 bankruptcy.
Jonathan Carson, who is co-CEO of bankruptcy services and tech firm Stretto, told FOX Business last week that 17 operating companies and large franchisees in the restaurant industry have filed for Chapter 11 bankruptcy so far.
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