Restaurant chain BurgerFi files for Chapter 11 bankruptcy

The number of restaurant chains that have filed for bankruptcy this year rose Wednesday after BurgerFi International filed for Chapter 11 protection.

The company said it filed for Chapter 11 reorganization to “preserve the value” of its BurgerFi and Anthony’s Coal Fired Pizza & Wings brands “for all stakeholders.”

Only its corporate-owned restaurants BurgerFi and Anthony’s Coal Fired Pizza & Wings are included in the bankruptcy proceedings, he said. There are 17 and 50 of them respectively.

BurgerFi’s petition was filed in the US Bankruptcy Court for the District of Delaware.

Restructuring chief Jeremy Rosenthal said the company’s need to file for Chapter 11 arose amid a “drastic decline in post-pandemic consumer spending amid sustained inflation and rising food and labor costs,” according to a news release.

BurgerFi, looking to improve its business, launched an extensive turnaround effort last year.

CEO Carl Bachmann said “legacy challenges” also “demanded today’s performance” despite the company seeing “positive early indicators of the turnaround plan launched less than a year ago”.

In its filing, BurgerFi estimated a range of $50-100 million for its assets. Estimated liabilities were $100-500 million.

The company was “confident” that the bankruptcy process “will allow us to protect and grow our brands and continue the operational turnaround begun less than 12 months ago and secure additional capital,” according to Rosenthal.

Meanwhile, customers can expect corporate and franchise restaurants to remain open as usual, BurgerFi said. Franchisees operate 76 BurgerFi restaurants and one Anthony’s location.

Other restaurant chains that have entered Chapter 11 bankruptcy this year include Roti, Buca di Beppo, Rubio’s Coastal Grill, Red Lobster and Tijuana Flats.

Just last week, Red Lobster received court approval to emerge from bankruptcy.

Jonathan Carson, co-CEO of bankruptcy services and technology firm Stretto, told FOX Business last week that 17 large operating companies and franchises in the restaurant industry have filed for Chapter 11 so far this year.

Breck Dumas contributed to this report.