Restaurant chain TGI Fridays files for bankruptcy protection | US News

Restaurant chain TGI Fridays filed for bankruptcy protection on Saturday, saying it is looking for ways to “ensure the long-term viability” of the casual dining brand after many of its locations closed this year.

The Dallas-based company filed for Chapter 11 bankruptcy protection in a federal court in Texas.

Rohit Manocha, chief executive officer of TGI Fridays, said in a statement that “the primary reason for our financial challenges is due to COVID-19 and our capital structure.”

In recent years, restaurant chains have faced greater challenges as diners opt to have their food delivered or visit more upscale fast food chains like Chipotle and Shake Shack.

A U.S. bankruptcy judge approved a restructuring plan for seafood chain Red Lobster in September after years of mounting losses and dwindling customers.

According to Kevin Schimpf, director of industry research at Technomic, TGI Fridays' popularity in 1965 peaked in 2008 with 601 restaurants in the U.S. and a $2 billion business. According to Technomic, U.S. sales were $728 million in 2023, down 15% from the previous year.

It now counts 163 restaurants in the U.S., up from 269 last year. Thirty-six of them were closed in January and dozens more last week.

TGI Fridays Inc. said it owns and operates only 39 restaurants in the United States, which represents only a fraction of the 461 TGI Fridays-branded restaurants around the world. A separate company, the TGI Fridays franchisor, owns the intellectual property and has franchised the brand to 56 independent owners in 41 countries. These remain open.