Hooters Files for Bankruptcy, Plans to Restructure and Continue Operations
Hooters, the restaurant chain known for its iconic orange uniforms and all-female wait staff, has filed for bankruptcy, the company announced Monday. Despite the filing, the decades-old brand assured that it is not disappearing and plans to emerge stronger.
In a move aimed at stabilizing its finances, Hooters intends to sell its 100 company-owned locations to two franchisee groups operating Hooters restaurants in Tampa, Florida, and Chicago. These groups together control about a third of the brand’s U.S. franchise locations.
This bankruptcy filing comes amid difficult business conditions, joining other fast-casual chains like BurgerFi and Red Lobster, which have faced similar financial struggles in recent years. Hooters has also been grappling with multiple lawsuits, including accusations of racial and gender discrimination, and was forced to close several locations last year due to rising food and labor costs.
Hooters has filed for Chapter 11 bankruptcy in a Texas court, a process that allows companies to restructure their finances and operations. The company plans to exit Chapter 11 in 90 to 120 days.
Sal Melilli, CEO of Hooters of America, emphasized the company’s commitment to maintaining its reputation and customer experience despite the restructuring: “Today’s announcement marks an important milestone in our efforts to reinforce Hooters’ financial foundation and continue delivering the guest-obsessed hospitality experience and delicious food our customers and communities have come to expect.”
The company clarified that, while it will continue operating its business normally, it is “evaluating the operational footprint” of its company-owned restaurants, which could result in additional closures.
In 2019, private equity firms Nord Bay Capital and TriArtisan Capital Advisors acquired Hooters, and the buyer group now includes the brand’s original founders. Neil Kiefer, CEO of Hooters Inc., voiced optimism for the future of the chain, stating that the founder-led buyout will help return Hooters to its roots and make it more family-friendly.
Kiefer assured customers that Hooters restaurants are here to stay, reaffirming that the brand is committed to its iconic status while evolving to meet new challenges.
