Florida Based Chain Ousts CEO In Bankruptcy

It has been a tough recovery for many businesses, and some have never really recovered. Business owners have been struggling with inflation, rising wages and shrinking margins for years and many still haven't figured it out. Back in July we reported that one beloved chain restaurant was in serious trouble due to an ill fated promo that almost collapsed the entire chain which ultimately filed for chapter 11 this year in Orlando.

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Red Lobster was at one time a single, family-owned restaurant in Lakeland, Florida with lines that went on and on for a table. The history is a good one, and we found some highlights to share. In 1970 General Mills backed rapid growth of Red Lobster and in 1974 they made popcorn shrimp, in 1992 cheddar bay biscuits and in 2008 they brought in wood fired grills, remodeled all the locations in 2010 and in 2021 were recognized by Forbes for being one of the best large employers. Then things started taking a turn when Golden Gate Capital sold to Thai Union. Thai Union is a seafood supplier and the folks that announced the endless shrimp promo which is widely viewed for the bankrupcy according to Nation's Restaurant News.

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Red Lobster Management LLC on July 22 2024 filed its “designation of successful bidder” paperwork with the U.S. Bankruptcy Court for the Middle District of Florida in Orlando. The seafood chain’s new owner will be RL Purchaser LLC, a bidder made up of Red Lobster’s lenders, which reportedly proposed a $376 million bid. On September 5th, a new hope was born as the court approval of the plan means chapter 11 will soon be in the past.

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As part of the Chapter 11 plan, RL Investor Holdings LLC will acquire the Red Lobster® restaurant chain from the Company. The acquisition is anticipated to close before the end of September.

On completion of the acquisition, Damola Adamolekun will become the CEO of the Red Lobster restaurant chain, and Jonathan Tibus, who has served as the Company’s CEO during the reorganization, will step down from the role and leave the Company. Damola looks forward to welcoming Jonathan Tibus as a frequent guest to eat at Red Lobster.

Damola - Established leader looking towards the futurePhoto byofficial media release site

“This is a great day for Red Lobster,” said Mr. Adamolekun. “With our new backers, we have a comprehensive and long-term investment plan – including a commitment of more than $60 million in new funding – that will help to reinvigorate the iconic brand while keeping the best of its history. Red Lobster has a tremendous future, and I cannot wait to get started on our plan with the Company’s more than 30,000 team members across the USA and Canada.

With this plan in place, and Red Lobster coming out of chapter 11 we are looking forward to great things. Will you be returning to this restaurant in the future?

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