Court in Canada Gives Green Light to Red Lobster Restructuring Plan
A Canadian court has approved the reorganization plan of Red Lobster, allowing the seafood chain to exit bankruptcy.
Justice Peter Cavanagh of the Superior Court of Justice in Toronto granted an order on Tuesday, recognizing and enforcing the plan previously approved by a U.S. bankruptcy judge.
This plan will enable all 27 Red Lobster locations in Canada to remain open, out of a total of approximately 544 locations that will continue operating after the restructuring, down from 578 at the time of the bankruptcy filing in May.
The U.S. approval of the restructuring plan was conditional on receiving approval from the Canadian court.
Under the reorganization, a lender group led by asset manager Fortress will acquire the business, a new CEO will be appointed, and more than US$60 million in new funding will be committed.
Upon the expected closing by the end of September, the chain will continue to operate as an independent company.
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