After declaring Chapter 11 bankruptcy in October, Maryville, Tenn.-based Classic American Restaurant Group, Ruby Tuesday, has emerged from bankruptcy, the company announced Wednesday. A Delaware bankruptcy judge approved of the company’s restructuring plan last week, allowing the company to shed liabilities (including 185 stores shuttered due to the pandemic), move forward with its current portfolio of 209 corporate-owned locations, and continue to invest in virtual delivery-only brands.
“Ruby Tuesday is a healthier company now and is positioned to be more efficient, competitive and stable for the future,” Shawn Lederman, CEO of Ruby Tuesday said in a statement Wednesday. “We want to thank our employees, partners and creditors for helping to ensure our plan of reorganization was successful and we look forward to continuing quality service for our guests and communities for many years to come.”
When Ruby Tuesday initially filed for bankruptcy, the company cited the “unprecedented impact” of the COVID-19 pandemic on their business, leading to the permanent closure of 185 stores most impacted by coronavirus-related challenges.
In November, the NRD Capital Management-owned restaurant chain received approval from the U.S. Bankruptcy Court for the District of Del. to begin a sale process of the company. At the time, Ruby Tuesday’s parent company RTI Holding — of which NRD Capital is an affiliate — had just under three weeks to enter a stalking horse agreement and until Jan. 19 to submit a bid. RTI Holding Company submitted a restructuring plan in December.
Ruby Tuesday is not the only company to be bought out of — or attempt to be bought out of — bankruptcy in 2020: Flynn Restaurant Group bid $816 million to buy NPC International out on bankruptcy earlier in November, and the Krystal Company was bought out of bankruptcy in May by Fortress Investment Group.
Ruby Tuesday’s advisors during its reorganization included Pachulski Stang Ziehl & Jones LLP as legal counsel, CR3 Partners, LLC, as financial advisor, FocalPoint Securities, LLC, as investment banker, and Hilco Real Estate, LLC, as lease restructuring advisor and consultant.
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