Los Angeles-based restaurant franchising company FAT Brands Inc. has commenced voluntary chapter 11 proceedings in the U.S. Bankruptcy Court for the Southern District of Texas. The filing comes after creditors pushed FAT Brands to pay back $1.3 billion in loans, Restaurant Dive reported.
Twin Hospitality, a Dallas-based affiliate of FAT Brands that was spun off last year, has also filed for bankruptcy protection. Both companies said separately that they plan to use the filings to deleverage their balance sheets, maximize value for stakeholders, and support continued growth of their brands.
The FAT Brands filing cited the mounting “liabilities and liquidity situation” of the two companies, according to Nation’s Restaurant News. FAT Brands sought “strategic alternatives, including restructuring options” and determined that filing for bankruptcy protection was in the best interest of company stakeholders.
FAT Brands’ portfolio of 18 restaurant concepts encompasses more than 2,200 locations worldwide. Its brands including Fatburger, Johnny Rockets and Round Table Pizza, among others, are expected to remain operating as usual during the Chapter 11 process. Despite the filing, FAT Brands has a pipeline of about 900 committed locations that are expected to open over the next five to seven years, reported Restaurant Dive.
Bankruptcy Court filings and other information about the claims process and proceedings can be found at a separate website maintained by the proposed claims and noticing agent for FAT Brands and Twin Hospitality, Omni Agent Solutions, Inc.
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