Get All Access for $5/mo

Red Lobster Is Reportedly Considering Filing for Chapter 11 Bankruptcy The seafood chain has gone through a slew of different private owners since it was established in 1968.

By Emily Rella

One of America's favorite fast casual restaurants famous for its "endless" promotions may be ending.

On Tuesday, Bloomberg reported that Red Lobster is close to filing for Chapter 11 bankruptcy as a part of a larger restructuring plan to work through debt and relieve the company of leases and contractual agreements, citing anonymous people close to the matter.

The Chapter 11 filing would allow Red Lobster to keep operations running while financials and debt restructuring are negotiated behind closed doors, though no final decisions have been made.

Related: Red Lobster CEO Resigns After Only 8 Months

Red Lobster is reportedly working with the law firm King & Spalding to assess the next steps.

The seafood chain has gone through a slew of different private owners since it was established in 1968.

In the summer of 2014, the chain was acquired by Golden Gate Capital after being purchased from Darden Restaurants, which also oversees Olive Garden and Longhorn Steakhouse.

Seafood supply company Thai Union purchased a 25% stake in Red Lobster in 2016 for an estimated $575 million before buying the remaining 75% from Golden Gate Capital in 2020.

Related: Red Lobster Lost Nearly $11 Million Because People Love Endless Shrimp: 'We Need to Be Much More Careful'

Earlier this year, Red Lobster rolled out an "Endless Lobster Experience" where 150 customers won a two-hour complimentary feast of unlimited lobster, two sides, and Cheddar Bay Biscuits — the deal sold out almost immediately.

But in November 2023, Red Lobster launched a $20 "Endless Shrimp" promotion that proved to be too popular, costing the company $11 million.

The chain is coming off a rough Q4 2023, where it lost an estimated $12.5 million in operating revenue.

"Red Lobster is done and over with," Thai Union Group CEO Chansiri said earlier this year regarding the company's plan to exit its stake in Red Lobster. "[We're] just waiting for the sale to happen, but we do not expect any significant value to be gained."

Emily Rella

Entrepreneur Staff

Senior News Writer

Emily Rella is a Senior News Writer at Entrepreneur.com. Previously, she was an editor at Verizon Media. Her coverage spans features, business, lifestyle, tech, entertainment, and lifestyle. She is a 2015 graduate of Boston College and a Ridgefield, CT native. Find her on Twitter at @EmilyKRella.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Side Hustle

The Side Hustle He Started in His College Apartment Turned Into a $70,000-a-Month Income Stream — Then Earned Nearly $2 Million Last Year

Kyle Morrand and his college roommates loved playing retro video games — and the pastime would help launch his career.

Growing a Business

How Visionary Leaders Transform Curiosity Into Groundbreaking Ideas

Lee Brian Schrager, founder of the South Beach Wine & Food Festival, discusses the spark that launched FoodieCon, his best practices for running popular food events, and why all business owners need to adapt to social media trends.

Business News

Homeowners in These 10 States Pay the Most in 'Hidden' Upkeep Costs

Hidden home costs pile on top of mortgage payments.

Data & Recovery

Get $60 off This Portable VPN Travel Router

Why keep paying for a VPN service when you can have a tiny, lightweight piece of hardware that can provide you with a lifetime of maximum VPN protection?

Money & Finance

Avoid These 10 Mistakes Entrepreneurs Make with Money

Despite the challenging statistic that only 5% of startups survive beyond five years, common financial pitfalls often contribute to their failure. Through personal observation, I've identified the prevalent financial mistakes made by entrepreneurs.

Growing a Business

5 Books to Help You Motivate, Unify and Build Perspective

In a post-Covid world, check out these must-read books to help build a more resilient organization, create a modern work culture and maintain a powerful growth mindset.