TGI Fridays' parent company has filed for Chapter 11 bankruptcy protection, pointing to the devastating effects of the COVID-19 pandemic on its business operations. The casual dining chain joins a growing list of major retailers and restaurants seeking bankruptcy protection in 2024.
The company's executive chairman, Rohit Manocha, announced the decision on Saturday, describing it as a difficult but necessary step to protect stakeholders, including franchisees and employees worldwide.
The restaurant chain has experienced a sharp decline in its U.S. presence, dropping from 237 locations in January to just 163 currently. This reduction follows the announced closure of 36 restaurants earlier this year, with additional quiet shutdowns occurring in subsequent months.
The bankruptcy filing specifically affects the parent company's 39 corporate-owned restaurants, while franchise-operated locations remain independently managed. To maintain normal operations during this transition, the company has secured financing to keep its remaining restaurants open.
Industry experts note that TGI Fridays faces increasing competition from newer, more agile dining concepts like Shake Shack, which offer faster service and lower prices. The chain joins other prominent names seeking bankruptcy protection this year, including Red Lobster, Big Lots, Tupperware, Express, and Joann.
Despite these challenges, the company plans to use the Chapter 11 process to explore strategic alternatives and develop a sustainable path forward. The move allows TGI Fridays to restructure while continuing to serve customers at its remaining locations.
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