According to officials behind the scenes, Hooters will be working alongside law firm Ropes & Gray over the next few months to prepare a filing.
As of now, detailed plans have not yet been finalized, and those behind the scenes have requested to remain private during the process.
Hooters has reportedly been working to address its debt load with lawyers, as well as with turnaround advisers from the boutique firm Accordion Partners.
It has also been reported that Hooters’ debt holders have even gone as far as to seek out Houlihan Lokey Inc. for further advice on the matter.
Additionally, due to the change in foot traffic and constantly changing playing field, Hooters has already shuttered several of its long-standing locations. The popular restaurant chain even reportedly sold upwards of $300 million in asset-backed bones in 2021.
Over the years, Hooters has fought vigorously against liquidity issues as foot traffic has declined across a large number of its locations.
For those curious, these asset-backed bonds were packaged as “whole-business securitizations,” meaning the company will pledge most of its assets, including franchise fees, as collateral. Whole business securitizations have become a popular product amongst major restaurant chains, fitness clubs and other various franchised businesses.
While time can only tell what is in store for Hooters, fans of the restaurant chain should be pleased to hear that work is being done behind the scenes to ensure more opportunities to serve the loyal customer base.
Times are tough all around, for businesses and customers alike, and it’s always unfortunate to see a legacy brand struggle to make ends meet. We’ll be sure to keep you informed as Hooters’ new plans progress.
