As of latest TGI Fridays news, TGI Fridays Inc. officially filed for Chapter 11 bankruptcy protection on November 2, 2024, in the US Bankruptcy Court for the Northern District of Texas located in Dallas. According to company filings, TGI Fridays listed its assets and liabilities in the range of $100 million to $500 million.
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TGI Fridays Inc. filed for Chapter 11 bankruptcy in Texas, enabling the company to restructure its debts and explore strategic alternatives to strengthen the brand’s future.
The restructuring process plans to provide TGI Fridays with the opportunity to address its debt issues and optimize operations.
As of latest TGI Fridays news, Executive Chairman Rohit Manocha addressed that the decision was made with the best interests of franchisees, employees and other stakeholders in mind.
Like many restaurant chains, TGI Fridays was severely impacted by the COVID-19 pandemic, which led to temporary closures of indoor dining spaces and a sharp decline in in-person dining.
The company’s existing capital structure coupled with pandemic-induced revenue declines, has strained its finances leading to this bankruptcy decision.
Rising costs of goods and services have placed additional pressure on TGI Fridays’ core middle-class customer base, contributing to reduced foot traffic and lower sales.
As of latest TGI Fridays news, Despite the bankruptcy filing, TGI Fridays restaurants including both company-owned and franchise locations will remain open throughout the restructuring period.
Franchise locations, managed independently are not included in the bankruptcy proceedings. TGI Fridays Franchisor, the entity overseeing franchising is unaffected, ensuring stability for its 461 worldwide locations.
At its height in 2008, TGI Fridays operated 601 US locations, generating around $2 billion in annual sales. By 2023, TGI Fridays’ US sales had decreased to $728 million, a 15% drop from the previous year.
Facing profitability challenges, the company closed 36 locations in early 2024 and shuttered 50 more in October, bringing its US store count down to 163 from nearly 270 at the start of the year.
As of latest TGI Fridays news, TGI Fridays maintains a global footprint with franchise locations in 41 countries, managed by 56 independent franchisees. These international sites will remain operational as they are not impacted by the Chapter 11 filing.
In the United Kingdom, a proposed acquisition of TGI Fridays by a UK franchisee fell through leading to the bankruptcy of the UK operations and the planned closure of several locations impacting approximately 1,000 jobs.
At its peak in 2008, TGI Fridays Inc. has 601 restaurants across the United States generating $2 billion in annual revenue.
However, by 2023, its US sales had dropped to $728 million, a 15% decline from the previous year. Currently, the company operates 163 locations in the US, down from 269 the previous year.
As of latest TGI Fridays news, In 2024 alone, TGI Fridays shut down dozens of underperforming branches.
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TGI Fridays Inc. directly owns and operates only 39 US-based locations, while the majority of US and international locations are franchised.
The brand’s intellectual property is held by TGI Fridays Franchisor, LLC, a separate entity that licenses the brand to franchisees in 41 countries worldwide.
While TGI Fridays Inc. is undergoing bankruptcy proceedings, the franchised locations remain unaffected and will continue to operate as usual.
As of latest TGI Fridays news, TGI Fridays Inc. Franchisor has arranged a transition services agreement to provide operational and financial support to the franchised branches throughout the restructuring process.
Interim funding has also been made available to ensure that support services for franchisees are maintained, allowing the franchise locations to continue normal operations.
TGI Fridays has an extensive international footprint with 461 restaurants in 41 countries, which continue to operate independently from the bankruptcy proceedings.
As the brand seeks to restructure, these franchised locations around the world will remain operational, securing a strong international presence for the brand.
TGI Fridays was originally founded in 1965 in Manhattan, New York and became a cultural icon known for its lively environment, elaborate happy hours and friendly atmosphere.
It is known for popularizing cocktails and happy hours, the brand has been credited with introducing the Long Island Iced Tea to a wider audience.
In 1988, the brand famously trained actor Tom Cruise in bartending skills for his role in the movie Cocktail, cementing its place in American pop culture.
TGI Fridays Inc. is privately owned by TriArtisan Capital Advisors, a private equity firm based in New York. TriArtisan acquired TGI Fridays with the intention of reviving its popularity, but has struggled to achieve this goal due to the pandemic and market shifts.
TGI Fridays Inc. is not alone in its struggle; other casual dining chains such as Red Lobster and Buca di Beppo, have also faced financial difficulties and sought bankruptcy protection in recent years.
In September 2024, Red Lobster exited Chapter 11 after years of declining sales, while Buca di Beppo filed for bankruptcy in August 2024.
Filing for Chapter 11 provides TGI Fridays with temporary protection from creditors, allowing the company to halt payments to landlords and vendors as it seeks to restructure.
The bankruptcy process will likely include the closure or sale of underperforming locations to streamline operations and focus on profitable sites.
As of latest TGI Fridays news, TGI Fridays Inc. owns only a fraction of its US locations, with the majority run by franchisees. By limiting the bankruptcy impact to the corporate-owned stores, the company aims to safeguard its franchise network’s stability.
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