Red Lobster Reportedly Heading to Bankruptcy

Red Lobster is having a hard time rebounding from the pandemic. Tuesday, it was revealed the national seafood chain is considering filing for bankruptcy in an attempt to restructure its business. The latest comes from Bloomberg, which reports Red Lobster has hired a firm—King & Spalding—to look over possible restructuring efforts that would allow the company to forgo bankruptcy. If not, according to the report, Red Lobster would file Chapter 11 bankruptcy, which would allow it to remain open while restructuring its debts.

Red Lobster was previously owned by Golden Gate Capital, which also owned restaurant chains like Romano's and California Pizza Kitchen. Golden Gate then sold Red Lobster to the Thailand-based Thai Union group, which owns various holdings around the world. Red Lobster is the only United States-based restaurant chain owned by Thai Union group, with the only states-based business being seafood packager Chicken of the Sea.

Bloomberg says the chain hasn't made an official decision whether to file bankruptcy or not, though internal discussions continue.

The chain's largely been out of the news for the past few years, at least since reports at the height of the pandemic suggesting Red Lobster was no longer going to be giving away its iconic Cheddar Bay Biscuits for free.

"This is absolutely not true," a company spokesperson told us of the reduced biscuit reports at the time. "Our restaurants continue to offer unlimited Cheddar Bay Biscuits for dine-in guests. Obviously when ordering To Go or delivery, guests receive a set number of biscuits based on their order since unlimited would be impossible."