The parent of the formerly Wichita-based Fox & Hound restaurant chain declared Chapter 11 reorganization bankruptcy on Wednesday, the latest in a series of recent national restaurant chain bankruptcies.
Last Call Guarantor LLC said in the filing that it had assets of $10 million to $50 million, and liabilities of $100 million to $500 million. The Dallas-based company – which owns Fox & Hound, Champps Kitchen & Bar and Bailey’s Sports Grille – filed in Delaware Bankruptcy Court.
The company operates 48 Fox & Hound, including one at 1421 N. Waterfront Parkway, which remains open. It also owns 23 Champps and nine Bailey’s Sports Grille locations and franchises five Champps locations. The company has restaurants in 25 states.
The chain also filed for bankruptcy in 2013 under previous ownership, when it had 101 locations. The owners, private equity funds Steel Partners LLC and Newcastle Partners LP, sold the assets to another private equity firm, Cerberus Business Finance, for $14.5 million in cash and $91.5 million in liabilities.
Fox & Hound was founded in Arlington, Texas, in 1994. Wichita businessman Jamie Coulter, co-founder of Wichita-based Lone Star Steakhouse & Saloon, bought Fox & Hound English Pub & Grille and the Charlotte, N.C., company that operated Bailey’s Sports Grille. He brought the headquarters to Wichita and took the company public in 1997.
Coulter stepped back from management in 1999, but retained a sizable ownership stake. After rapid growth, the company began to struggle and was purchased by the private equity firms in 2006 and taken private.
Fox & Hound is one of at least five national food and drink chains to declare bankruptcy since last last year, including Logan’s Roadhouse, which filed Monday, and Johnny Carino’s, which filed last month.
Even in the industry, the overarching reason behind the recent “restaurant recession” is mysterious, said Jon Rolph, president of Sasnak Management, which owns Carlos O’Kelly’s and is an Applebee’s franchisee.
Chains all over the country are seeing stagnant or declining sales at the same time labor costs are rising because of tight employment and government efforts to raise wages. Some in the industry have said it may presage a recession, while others say it could mean a deeper change in dining habits, he said.
“It’s really something going on with the consumer; it’s not like gas prices have spiked,” Rolph said. “On a macro level, something is changing people’s behavior.”