Tex-Mex casual dining chain Chi-Chi’s was founded in 1975 by Marno McDermott and Max McGee and grew to more than 200 locations during its heyday in the last 20th century. By 2004, however, the chain had closed the doors of its last remaining domestic restaurant.
Apparently, however, not for good.
Twenty years later, the founder’s son, Michael McDermott, has announced an agreement with Hormel Foods to bring the Chi-Chi’s restaurants back next year through a new company called Chi-Chi’s Restaurants LLC. Hormel owns Chi-Chi’s trademarks for its retail products, including tortilla chips and salsa.
McDermott has built his career in the restaurant industry with brands such as Kona Grill and Rojo Mexican Grill. In a statement, he said he was determined to honor his family’s legacy by combining the classic Chi-Chi’s restaurant experience with modern influences.
"I still have fond memories of growing up in the Chi-Chi’s restaurants that my father built throughout their time, instilling in me the passion and determination to pursue my own career in the restaurant industry," he said. "We have seen the impact our restaurant has had on individuals and families across the country and believe there is a strong opportunity to bring the brand back in a way that resonates with today's consumer – an updated dining experience with the same great taste and Mexican flavor."
The brand’s comeback will not impact its retail business.
Chi-Chi’s closure in the early aughts came after a series of challenges, including several ownership changes during the 1980s and 1990s. The company filed for Chapter 11 bankruptcy in October 2003, and later that month, it was identified as the source of a massive Hepatitis A outbreak stemming from its green onion supply. The outbreak, which originated in Pennsylvania, sickened at least 650 people, with four fatalities. It remains the largest Hepatitis A outbreak in American history.
In 2004, Outback Steakhouse Inc. acquired the remaining 76 Chi-Chi’s restaurants for $42.5 million and converted most of them into its own brands, which at the time included Outback Steakhouse, Carrabba's Italian Grills, Bonefish Grills, Fleming's Prime Steakhouse and Wine Bars, Roy's, and Cheeseburger in Paradise. In addition to its retail presence, a single Chi-Chi’s restaurant has remained in operation in Vienna, Austria.
Contact Alicia Kelso at [email protected]
