TGI Fridays Inc., which owns and operates 39 local restaurants in the casual dining chain, filed a lawsuit. Chapter 11 Bankruptcy Conservation in Texas’ Northern Territory marks another failure in America’s fight restaurant industry.

The filing comes at a critical time for the nearly 60-year-old chain, which closed 50 locations last week and reduced its total U.S. presence from about 270 restaurants to 163 restaurants by the beginning of 2024.

The brand’s intellectual property, which is owned by TGI Fridays Franchisor, LLC through a securitization agreement with a separate investor group, is specifically excluded from the bankruptcy proceedings.

news week He contacted TGI Fridays’ press officer via email on Saturday for comment.

“The next steps announced today are difficult but necessary actions to best protect the interests of our stakeholders, including our domestic and international franchisees and valued team members around the world,” said Rohit Manocha, Chief Executive Officer of TGI Fridays Inc. expression.

Manocha found: Covid-19 pandemic and the company’s capital structure are seen as the main drivers of financial difficulties.

The once-popular restaurant chain, which started as a singles bar in Manhattan in 1965 that helped popularize the concept of “happy hour” and decorative “flair” for its employees, secured debtor financing to continue operations throughout the restructuring process. .

The company also filed an application with the Bankruptcy Court to continue its customer programs without interruption.

Operations will continue as usual for the chain’s extensive franchise network, which includes 56 franchisees in 41 countries. TGI Fridays Franchisor, LLC implemented a Transition Services Agreement and provided interim funding to maintain support services while developing a new long-term support structure for franchise operations.

The bankruptcy filing follows recent problems with the company’s international operations. In September, TGI Fridays’ UK division faced its own crisis; This resulted in the closure of multiple restaurants and the loss of approximately 1,000 jobs after a proposed takeover by the UK franchisee fell through.

TGI Fridays joins other casual dining casualties of the post-pandemic era: Red Lobster And Buca di BeppoThey had also filed for Chapter 11 protection in recent months.

The chain’s restructuring efforts come amid broader challenges facing the restaurant industry, including changing consumer preferences, inflation pressures and the lingering impact of COVID-19 restrictions.

“This restructuring will allow our forward-looking restaurants to move forward with an optimized corporate infrastructure that will enable them to reach their full potential,” Manocha added.

The bankruptcy court must still approve various requests to allow the company to continue normal business operations during the restructuring process.

While the immediate future of the company’s 39 locations remains uncertain, the company’s franchise network continues to operate independently under the protection of bankruptcy proceedings.