Logan’s Roadhouse in bankruptcy after diners choose rivals
Logan’s Roadhouse Inc. filed for bankruptcy this week in Delaware after competition from rival casual-dining chains ate into its sales.
The operator and franchiser of more than 250 roadhouse-themed restaurants in 23 states has suffered as other companies offered steep discounts and improved technology with tabletop tablets and order-ahead capabilities. The company plans to close 18 locations, and its CEO will resign.
The two Wichita locations – on Rock Road near Towne East Square and on Maize Road in NewMarket Square – are unaffected, according to a local general manager.
The Nashville, Tenn.-based chain tried to attract diners with Southern-inspired cuisine such as bread pudding, brisket nachos and glazed chicken wings, as well as happy hour deals, but revenue still fell 9.9 percent to $131.3 million in the quarter ended Oct. 28.
As a part of the restructuring plan, Sam Borgese, who has been chief executive officer since 2014, will resign, according to a statement. The company also said it has identified 18 restaurants it will close and expects to help employees with reassignments to other Logan’s restaurants, outplacement services and assistance with applying for jobs.
The chain had assets of $347.2 million and debt of $546.1 million as of June 30, according to court filings. About 10 percent of Logan’s Roadhouse restaurants are franchised.
Logan’s will seek interim approval to borrow as much as $10 million of a total of $25 million in debtor-in-possession financing. A hearing was scheduled for Tuesday.
The company’s first location opened in 1991 in Lexington, Ky. Cracker Barrel Old Country Store Inc., another casual-dining restaurant, bought the chain in 1999.
In 2010, Roadhouse Holding Inc. – formed by Kelso & Co. and some management – acquired Logan’s. New York-based Kelso owned 97 percent of the newly formed company’s stock at the time, according to regulatory filings.
This story was originally published August 9, 2016 at 11:54 AM with the headline "Logan’s Roadhouse in bankruptcy after diners choose rivals."