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The number of restaurant chains that have filed for bankruptcy this year grew on Wednesday after BurgerFi International filed for Chapter 11 protection.
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."
Only its corporate-owned BurgerFi and Anthony’s Coal Fired Pizza & Wings restaurants are included in the bankruptcy proceedings, it said. There are 17 and 50 of those, respectively.
The BurgerFi logo is seen at a location in Arlington, Virginia, on Aug. 20. (Tierney L. Cross/Getty Images / Getty Images)
BurgerFi’s petition was filed in the U.S. Bankruptcy Court for the District of Delaware.
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Chief Restructuring Officer Jeremy Rosenthal said the company’s need to file for Chapter 11 arose amid a "drastic decline in post-pandemic consumer spending amidst sustained inflation and increasing food and labor costs," according to a press release.
BurgerFi, seeking to improve its business, launched an extensive turnaround effort last year. Ticker Security Last Change Change % BFI BURGERFI INTERNATIONAL 0.16 +0.02 +11.27%
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."
A BurgerFI employee prepares an order in Arlington, Virginia, on Aug. 20. (Tierney L. Cross/Getty Images / Getty Images)
In its filing, BurgerFi estimated a range of $50-$100 million for its assets. Estimated liabilities were $100-$500 million.
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The company was "confident" 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.
In the meantime, customers can expect corporate and franchised restaurants to remain open as usual, BurgerFi said. Franchisees operate 76 BurgerFi restaurants and one Anthony’s location.
A burger, fries and chicken tenders are displayed at a BurgerFi location in Arlington, Virginia, on Aug. 20. (Tierney L. Cross/Getty Images / Getty Images)
Other restaurant chains that have entered Chapter 11 bankruptcy this year include Roti, Buca di Beppo, Rubio’s Coastal Grill, Red Lobster and Tijuana Flats.
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Just last week, Red Lobster received court approval to exit bankruptcy.
Jonathan Carson, co-CEO of bankruptcy services and technology firm Stretto, told FOX Business last week that 17 operating companies and large franchisees in the restaurant industry have filed for Chapter 11 so far this year.
Breck Dumas contributed to this report.
