Last Updated on September 23, 2020, 8:28 AM AST by Anthony Morris
On Monday, Sizzler USA filed for voluntary Chapter 11 bankruptcy protection and would begin a restructuring process which would allow the family casual steakhouse to reduce their long-term debt and renegotiate leases with the landlords at its 14 company-owned restaurants during the process of bankruptcy, according to a press release.
The company said during the bankruptcy filing that its liabilities were between $1 million and $10 million.
The company also filed customary motions with the bankruptcy court to allow the company to meet its contractual obligations, including fulfilling the company’s financial commitments to its vendors, employees and over 90 franchised locations.
Sizzler plans on completing the Chapter 11 process within about 120 days.
Sizzler’s president and chief services officer, Chris Perkins said in a statement that this process would not impact franchisees.
Sizzler is the latest casual dining company which has filed for bankruptcy protection because of the financial impacts of COVID-19, which faced the chain with long-term indoor dining room closures and landlords who did not provide rent abatements.
California Pizza Kitchen and CEC Entertainment have also filed for Chapter 11, while Luby’s is considering a sale of its assets.
This bankruptcy filing is not the first filing for Sizzler. In 1996, when Sizzler was a public company, and past sales had reached $1 billion, it closed 136 company-owned restaurants mainly in the East Coast after a Chapter 11 filing. The company has also gone through multiple owners since then.
The company was first purchased by Pacific Equity Partners, which made it a private company in 2005, then bought by a Sizzler-led management group, which acquired Sizzler’s USA assets in 2011.
Soon after, the company rebranded, focusing on fresh, quality ingredients and reconnecting with former customers. The rebrand led to a 20% increase in sales and guest count in 2012.
Anthony Morris covers stories related to politics and regional developments. His in-depth reporting about governance and reforms makes him stand out in regional journalism, with a deep analysis of political trends and their impact on Caribbean communities.
