A report from Bloomberg News claims that the Hooters restaurant chain is preparing to file for bankruptcy. This is reportedly after declining foot traffic in their establishments known for their waitresses with tight, skimpy clothing.
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Report: Hooters Chain To File For Bankruptcy Within Two Months
The company seems to be planning some restructuring after working with the Ropes & Gray law firm. Sources told the outlet that these filings could happen within the next two months. With around 300 locations across the world, this bankruptcy could lead to mass restaurant closures.
Hooters reportedly claimed it's struggling due to customers eating out less, leading to less foot traffic. It also blamed the elevating cost of food and rent. During this stressful time, Hooters has received help from Accordion Partners to help with its debt. The Atlanta, Georgia-based company also turned to the investment bank Houlihan Lokey.
The iconic restaurant chain has been around for nearly 42 years now and has been through some rough times already. Due to the effects of inflation, Hooters shut down 40 locations last June.
"Like many restaurants under pressure from current market conditions, Hooters has made the difficult decision to close a select number of underperforming stores," read the statement. "Ensuring the well-being of our staff is our priority in these rare instances."
The statement described the business as "highly resilient and relevant." With mentions of newly-opened restaurants and new Hooters-branded frozen products, Hooters plans to stick around.
But now things have gotten a lot more serious. We learned last fall that the restaurant chain was looking to deal with its $300 million in debts, as per another Bloomberg report. Months have passed since then, and the company's financial burdens are still ever present.
This situation is not too dissimilar to Red Lobster filing for bankruptcy in May 2024. This popular restaurant chain also suffered from huge profit loss, leading it to close nearly 100 locations.
The boat has been rocky ever since Nord Bay Capital and TriArtisan Capital Advisors purchased Hooters in 2019. Not too long after the pandemic happened causing citizens nationwide to quarantine in their homes. Restaurants and businesses worldwide struggled to get customers during this time, not just Hooters.
