Restaurant chain TGI Fridays filed for bankruptcy protection Saturday, saying it is looking for ways to “ensure the long-term viability” of the casual dining brand after closing many of its branches this year.
The Dallas-based company filed for Chapter 11 bankruptcy protection in a Texas federal court.
TGI Fridays executive chair Rohit Manocha in a statement said the “primary driver of our financial challenges resulted from COVID-19 and our capital structure”.
Sit-down chain restaurants have more broadly faced challenges in recent years as diners choose to get food delivered or visit more upscale fast food chains such as Chipotle and Shake Shack.
A US bankruptcy judge in September approved a reorganization plan for seafood chain Red Lobster after years of mounting losses and dwindling customers.
Founded in 1965, the popularity of TGI Fridays peaked in 2008 with 601 restaurants in the US and a $2bn business, according to Kevin Schimpf, director of industry research at Technomic. Its sales in the US were $728m in 2023, down 15% from the prior year, according to Technomic.
It now counts 163 restaurants in the US, down from 269 last year. It closed 36 in January and dozens more in the past week.
TGI Fridays Inc said it only owns and operates 39 restaurants in the US, which is just a fraction of the 461 TGI Fridays-branded restaurants around the world. A separate entity, TGI Fridays Franchisor, owns the intellectual property and has franchised the brand to 56 independent owners in 41 countries. Those remain open.