Popular restaurant chain TGI Fridays has filed for bankruptcy in the United States after suffering prolonged financial challenges and a collapsed deal with UK-based company Hostmore.
TGI Fridays, privately owned by TriArtisan Capital Advisors, filed Chapter 11 bankruptcy protection with the United States bankruptcy court for the Northern District of Texas yesterday (2 November).
TGI Fridays files for bankruptcy in the United States
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According to Reuters, the company listed both assets and liabilities in the range of USD100 million (RM437 million) to USD500 million (RM2.18 billion).
TGI Fridays has been a popular casual dining chain in the United States since its first bar opened in Manhattan, New York, in 1965.
Despite the filing, TGI Fridays said that it maintains operations across its 39 “Thank God it’s Friday!” restaurants in the US as it has secured a financing commitment to support operations.
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TGI Fridays executive chairman Rohit Manocha said that the primary driver of its financial challenges resulted from COVID-19 and the company’s capital structure.
Hence, a restructuring will allow its restaurants to proceed with an optimised corporate infrastructure that enables them to reach their full potential.
TGI Fridays closed all its restaurants in the United Kingdom
In September, Hostmore, a British restaurant operator, dropped plans to buy TGI Fridays after it was removed as the manager of TGIF Funding, which owns the right to collect royalties from the restaurant chain franchise.
Hostmore operated TGI Fridays in Britain through its unit Thursdays (UK). Recently, its shares crashed 90% due to the news, and the company announced its intention to enter administration after being overwhelmed with debt.
The administrators of Thursdays (UK) in October revealed that 35 TGI Fridays restaurants in the country have been closed, leading to job losses for 1012 people.
TGI Fridays’ bankruptcy in the United States won’t affect its international franchisees, including Malaysia
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Back in the United States, following the bankruptcy announcement on Saturday, the chain said normal operations will continue in all of the franchise locations both in the United States and internationally.
TGI Fridays Franchisor, which owns the brand and intellectual property, has franchised TGI Fridays to 56 franchisees in 41 countries, including Malaysia, where it is operated by CRAVEAT.
It is unknown how the bankruptcy filing in the United States would affect TGI Fridays’ operation in Malaysia.
So, what do you guys think of the whole situation? Share your thoughts with us in the comments.
Also read: The End of an Era? Tupperware May Be Filing for Bankruptcy After Almost 80 Years of Operations
This post first appeared on WORLD OF BUZZ.
