BurgerFi International, the parent company of BurgerFi and Anthony’s Coal Fired Pizza & Wings, has filed for Chapter 11 bankruptcy, adding to a growing list of restaurant chains facing financial difficulties this year.
The company’s decision, announced Wednesday, is part of an effort to “preserve the value” of its brands while navigating a challenging economic environment.
The bankruptcy filing, submitted to the US Bankruptcy Court for the District of Delaware, involves 67 corporate-owned locations, including 17 BurgerFi and 50 Anthony’s restaurants. Franchise-owned locations, which include 76 BurgerFi and one Anthony’s, are not affected by the proceedings and will continue operating as usual.
According to Jeremy Rosenthal, BurgerFi’s Chief Restructuring Officer, the company faced a “drastic decline in post-pandemic consumer spending amidst sustained inflation and increasing food and labor costs.” This economic pressure, combined with legacy challenges, pushed the company to seek Chapter 11 protection despite efforts to turn the business around.
BurgerFi has been working on a turnaround plan since last year, which included leadership changes and the closure of underperforming locations. CEO Carl Bachmann stated that the company has seen early positive signs from this plan but that ongoing financial struggles necessitated the bankruptcy filing.
In its filing, BurgerFi estimated its assets to be between $50 million and $100 million, with liabilities ranging from $100 million to $500 million. Despite these challenges, the company expressed confidence that the bankruptcy process would provide a path to stabilize operations, protect the brand, and secure additional capital.
BurgerFi joins several other restaurant chains that have filed for bankruptcy in 2024, including Red Lobster, Buca di Beppo, Rubio’s Coastal Grill, and World of Beer. Factors such as rising operational costs and declining consumer spending have impacted the entire restaurant industry, leading to widespread closures and financial restructuring.
With input from New York Post, the Daily Mail, USA Today.
