Hooters files for bankruptcy: Iconic US restaurant in substantial debt but says brand is here to stay
Restaurant chain Hooters of America has filed for bankruptcy in Texas, aiming to address its $US376 million ($601 million) by transferring ownership of all its company-operated restaurants to a group backed by the original founders.
The company currently manages 151 locations directly and has an additional 154 restaurants run by franchisees, primarily in the United States.
During the transition, Hooters’ restaurants will continue to operate as usual, maintaining their focus on serving classic American pub food with it’s unique point of difference. The chain has faced significant challenges in recent years, similar to other casual dining establishments, due to rising costs, wages, and reduced American consumer spending.
Hooters is renowned for its distinctive waitstaff, known as “Hooters Girls,” and its signature chicken wings.
“Our iconic Hooters restaurants are here to stay,” stated Sal Melilli, chief executive of Hooters of America.
“Today’s announcement marks a crucial step in our efforts to strengthen Hooters’ financial foundation.”
The financial details of the transaction have not been disclosed, and the deal requires approval from a US bankruptcy judge. Hooters anticipates completing the restructuring within the next four months.
“With over 30 years of hands-on experience across the Hooters ecosystem, we have a profound understanding of our customers and what it takes to not only meet, but consistently exceed their expectations,” Neil Kiefer, a member of the buyer group and the current chief executive of the original Hooters’ location in Clearwater, Florida told CNBC.
Founded in 1983, Hooters is known for its distinctive uniforms and signature menu items, which have become integral to its brand identity.
The chain currently has only one remaining Australian location, situated in Parramatta, Sydney. However, it is not yet known if global restructures will affect this franchise.
Casual dining restaurants in America have been hammered by rising costs in 2024, with well-known chains like TGI Fridays, Red Lobster, Bucca di Beppo, and Rubio’s Coastal Grill all filing for bankruptcy last year.
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