Vasari LLC shutters restaurants in New Mexico, Oklahoma and Texas
Texas-based Dairy Queen franchisee Vasari LLC has closed 23 units across three states with a filing this week for Chapter 11 bankruptcy protection, the company said.
Vasari, the Irving Texas-based company that filed a petition Monday in U.S. Bankruptcy Court for the Northern District of Texas, continues to operate about 45 Dairy Queen units after closing one location in New Mexico, three in Oklahoma and 19 in Texas, the company said
“This decision was based solely on what’s best to have a healthy company and ensure the long-term success of our core restaurants for our customers, employees and other stakeholders,” William Spae, Vasari president and CEO, said in a statement.
“Given the support we have from our primary stakeholders toward a consensual plan of reorganization,” Spae added, “we believe this process should have minimal impact on our customers and employees at the remaining restaurants.”
About 700 workers are employed at the remaining restaurants, the company said.
A company spokesperson said no decision has been made on the remaining locations, “although some may close within the next 90 days.”
In the filing, Vasari said many of its restaurants are in the Texas oil patch region, whose economy has struggled as oil prices plummeted over the past several years. Several of Vasari’s units were also in areas hit by Hurricane Harvey, which impacted South Texas in late August and resulted in damage, prolonged closures and loss of inventory.
Lou Romanus, CEO of the Texas Dairy Queen Operators Council, issued a statement after Vasari’s filing.
“Although the franchisee determined that bankruptcy protection was necessary to strengthen its company, Dairy Queen remains a strong brand in our state,” Romanus said. “Texas is home to 130 Dairy Queen franchisees and more than 575 locations – more than any other state in the U.S. – the majority of which will continue to serve your communities.”
Vasari said it plans to modernize and improve the restaurants that remain open after the bankruptcy proceedings.
Franchisor American Dairy Queen Corp., based in Minneapolis and a subsidiary of Berkshire Hathaway Inc., ranked No. 20 in this year’s Nation’s Restaurant News Top 100 census, with estimated Dairy Queen brand systemwide domestic sales of $3.6 billion in the 2016 fiscal year ended in December.
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