100 Montaditos looks to restructure US operations100 Montaditos looks to restructure US operations

100 Montaditos put its struggling U.S. operations into bankruptcy earlier this month to give its new management team a chance to reorganize the brand’s efforts here, according to court filings in the case.

But in a separate filing, a Florida franchisee seeking to ensure the closure of its restaurant called 100 Montaditos’ attempt to franchise its business in the U.S. a “fiasco,” and claimed the company “essentially abandoned” its franchise system here.

The filings paint a clearer picture as to why 100 Montaditos, a chain that is popular in its native Spain, would put its U.S. operations into bankruptcy less than four years after it arrived in the States.

The unexpected bankruptcy was filed two weeks ago in a series of 14 filings in U.S. Bankruptcy Court, but until recently have been sparse on details.

There is no secured debt, according to a filing last week, meaning the brand struggled simply because locations were losing money. All told, the company has cited more than $500,000 in unsecured claims against the various corporate entities that filed bankruptcy. The amount doesn’t include leases.

The company also said in its filing that it installed a new management team last year that is “studying and conducting a new restructuring plan” to redefine strategies and objectives for 100 Montaditos in the U.S. market.

To accomplish the reorganization, the company filed for bankruptcy so it could reorganize “without paralyzing its activity,” according to the filing.

The company indicated that it plans to simplify its cost structure and group restaurants “in certain areas of influence” to enable the optimization of logistics. The company indicated that iconic locations in New York, Washington, D.C., and Miami, “among others,” would remain.

But it remains uncertain how many restaurants could close. The company initially filed 14 separate cases, including 11 cases for specific locations, mostly in Florida. The company has 17 units.

One of the company’s franchisees, Florida-based Thinkgusto LLC, described a struggling franchise system in a filing last week.

Thinkgusto’s owners contacted the franchisor before the bankruptcy in an effort to close its location, which they say is losing $1,000 per day. They filed an emergency motion to ensure that they can close that location.

According to the filing, 100 Montaditos’ Spanish-based owner, Grupo Restalia Eurorestauracion SA de CV, continually replaced its U.S. management team since establishing its U.S. operations in September 2011.

“A playbill is required to keep track of the ‘revolving door’ of managers that (the chain’s Spanish owner) Restalia has installed and removed every several months, like clockwork,” the filing stated.

“Restalia’s attempts to start an American franchise system … have been an absolute fiasco,” according to the filing.

Thinkgusto began operating its location in West Palm Beach, Fla., in 2013. The company said it paid $60,000 in franchise fees to open two locations.

In its filing, Thinkgusto said 100 Montaditos terminated virtually all of the franchise agreements in its U.S. system, “while leaving the last few remaining non-affiliate franchisees, such as Thinkgusto, to ‘die on the vine.’”

100 Montaditos first opened in Florida four years ago with the intention to expand aggressively in the U.S. The fast-casual concept offers bite-sized “montaditos,” or sandwiches made on tiny baguettes.

Contact Jonathan Maze at [email protected].
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