Chapter 11 Bankruptcy Protection

Amid COVID-19 Pandemic, Ruby Tuesday Files For Chapter 11 Bankruptcy Protection

Business

Ruby Tuesday has filed for Chapter 11 bankruptcy protection as the casual dining chain was finding it difficult to survive for long and things got complicated because of the coronavirus pandemic. It has closed around 200 locations in the past few years. Now it has nearly 300 restaurants operational and it is not clear if Ruby Tuesday will close more locations. The company is taking the path of debt-cutting with the aim of improving its finances and stay in business. The dining chain in a statement said that it has reached an understanding with all it secured lender to offer support in its restructuring. This is not the first chain to do as several others were forced to file for bankruptcy because of indoor dining and tough economic situation. Among those who have taken such steps are California Pizza Kitchen, Sizzler USA, Vapiano, and Chuck E. Cheese.

According to a search on the Ruby Tuesday website, the company will not open its outlet on a flagship location in New York’s Times Square. The casual dining chain has been facing increased competition from fast-food companies along with reduced traffic to its locations with the surge in online delivery options. The company specializes in steaks, ribs, chicken, appetizers, seafood, and a garden bar. Meanwhile, Ruby Tuesday CEO Shawn Lederman in a court filing said that the company is going to permanently close 185 outlets that have been shut since the coronavirus pandemic struck. The company will now have 236 operational outlets.

Ruby Tuesday has seen some major leadership changes in the five years. The company saw has seen at least five CEOs – JJ Buettgen, Jim Hyatt, Lane Cardwell, Aziz Hashim, and most recently Ray Blanchette. Blanchette left the company in 2018 after serving it for just nine months. He has now joined TGI Friday. Most of these CEOs set targets of pulling the straggling chain out of the trouble. Meanwhile, there were reports that the company has stopped the pension of several employees.

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