Popular seafood chain Red Lobster has reportedly begun closing nearly 127 stores in 27 states.
As of Tuesday, the Red Lobster website listed the affected locations as “closed,” Fox 59 reported.
In Danville, Illinois, Mayor Ricky Williams Jr. expressed his frustration on Facebook.
“One of our local Red Lobster managers just informed me that after 31 years of serving our community, their parent company has laid off their entire staff without notice and is closing the restaurant immediately,” Williams wrote.
“This is despite their customer service and satisfaction ranking being 15th out of over 600 stores last year. They also closed Nearly 120 other stores Without further notice,” Williams added.
The parent company’s sudden decision to close the locations comes as it prepares to auction more than 50 locations across the country. Restaurant liquidation company TageX Brands has announced it will oversee the sale of equipment from shuttered restaurants, describing it as “the largest restaurant equipment auction ever.” However, only 48 locations are specifically listed in its directory, according to Fox Business.
“As of today, some Red Lobster locations have closure. In our restaurant equipment market, we are auctioning over 50 locations nationwide.These auctions are winner takes all – This means each winner will receive all Contents of the Red Lobster locations they bid on. The auction is ongoing and will end regularly on Thursday, May 16, 2024. TagX writes on its website.
Locations participating in the massive auction span multiple states. This sale includes locations in the following states:
Alabama
california
- reading
- ronette park
- sacramento
- San Diego
- torrance
Colorado
- Denver
- lakewood
- Lone tree
- Mailing
Florida
- altamonte springs
- gainesville
- Hialeah
- lago
- orlando
Georgia
idaho
Illinois
Indiana
Iowa
Maryland
- Gaithersburg
- Colombia
- silver spring
- Laurel
Michigan
mississippi
New York
- amherst
- Kingston
- Rochester
New Jersey
north dakota
Oklahoma
south carolina
Texas
- lake jackson
- long term
- saint antony
Virginia
- colonial highlands
- williamsburg
- newport news
washington
Wisconsin
Earlier this year, Red Lobster owner Thai Union Group announced plans to sell its stake in the brand, citing ” [the] The COVID-19 pandemic, ongoing industry headwinds, rising interest rates and higher material and labor costs” impacted profits.
Earlier this year, rumors surfaced that Red Lobster was considering filing for bankruptcy to ease its financial burden.
Business Insider reports:
Restaurant chain Red Lobster could file for bankruptcy protection as soon as next week, The Wall Street Journal reported Tuesday.
The company is saddled with hundreds of millions of dollars in debt and plans to file for Chapter 11 bankruptcy in Orlando before Memorial Day, people familiar with the matter told The Wall Street Journal.
Bloomberg previously reported in April that the restaurant company was considering filing for bankruptcy protection. Chapter 11 Bankruptcy Protection.
[…]
Red Lobster and outside observers believe leasing costs, reduced foot traffic during COVID-19 lockdowns and a failed all-you-can-eat shrimp promotion were some of the reasons for the company’s demise.
The financial problems led Thai Union Group, which acquired a majority stake in Red Lobster in 2020, to withdraw its investment. During an earnings call in February, Thai Union CEO Thiraphong Chansiri said: “We are exiting. We will not inject any more capital into Red Lobster.
The sudden closure of Red Lobster stores is another indicator of the economic difficulties facing U.S. businesses under the Biden administration. As inflation and costs continue to rise, more and more businesses are finding it difficult to stay afloat.
The question remains: How many more businesses will fall victim to these economic conditions before Trump is re-elected this November?
