The parent company of Johnny Rockets, Fatburger and Round Table Pizza filed for Chapter 11 bankruptcy protection.
Beverly Hills-based Fat Brands Inc. said in a statement that it filed for bankruptcy Monday to restructure debt it accumulated while expanding its portfolio of companies, citing “difficult and largely unforeseen” market conditions.
The company's portfolio includes several brands with roots in the south of the country. She is the owner of the retro restaurant chain Johnny Rockets, founded in 1986 on Melrose Avenue in Los Angeles; Hot Dog on a Stick, a mall staple, founded in 1964 in Santa Monica; and the Fatburger hamburger chain, founded in 1947 in the Exposition Park neighborhood of Los Angeles.
Fat Brands also has investments in two brands that started in the Bay Area: pizza chain Round Table Pizza, founded in 1959 in Menlo Park, and fast-casual chain Yalla Mediterranean, founded in 2014 in Pleasant Hill.
The company has accumulated more than $1 billion in debt, according to its Securities and Exchange Commission. presentation. The company filed for bankruptcy in the United States Bankruptcy Court for the Southern District of Texas.
“Our dynamic portfolio of brands has demonstrated tremendous resilience in a challenging restaurant operating environment over the past few years,” Fat Brands CEO Andrew Wiederhorn said in a statement.
Chapter 11 protection will give the company the opportunity to “strengthen our capital structure to support our concepts,” he said.
Fat Brands has a portfolio of 18 restaurant concepts with more than 2,200 locations worldwide, according to the company's November SEC filing. presentation. More than 90% of its stores are franchised.
Its shares fell 13% on Thursday. They have fallen close to 90% in the last three months. It received a delisting notice from the Nasdaq market earlier this month.
Company spokeswoman Erin Mandzik said in an email that the company's restaurants are expected to continue operating as usual throughout the reorganization process.
The Times reported in 2022 that Wiederhorn, the founder of Fat Brands, was investigated for alleged tax fraud. The charges were dismissed in July, but a federal judge ordered the U.S. Department of Justice to explain its decision, the Los Angeles Business Journal reported.
