Outback Steakhouse parent company Bloomin' Brands is moving to acquire 61 restaurants operated by a major franchisee that filed for Chapter 11 bankruptcy protection.
Out West Restaurant Group, which operates Outback Steakhouse locations across the western United States, filed for bankruptcy protection in Delaware on Monday, according to a filing with the Securities and Exchange Commission.
Bloomin' Brands has entered into an agreement to purchase Out West's assets for approximately $26.3 million, subject to certain adjustments and the assumption of specified liabilities.
MCDONALD'S DEALT LEGAL SETBACK AS JUDGE ALLOWS MCRIB MEAT LAWSUIT TO PROCEED
The company is expected to serve as the "stalking-horse" bidder in the bankruptcy sale process, establishing an initial offer that other potential buyers can seek to exceed. The transaction remains subject to bankruptcy court approval.
Bloomin' Brands also agreed to provide up to $5.5 million in interest-free debtor-in-possession financing to support Out West's operations during the Chapter 11 proceedings, subject to court approval.
Out West intends to continue operating its restaurants throughout the bankruptcy process, according to the SEC filing.
Bloomin' Brands said the filing would have no immediate impact on customers, restaurant employees or daily operations at the affected Outback Steakhouse locations.
The bankruptcy involves restaurants operated by the franchisee rather than Bloomin' Brands' corporate-owned locations.
Out West is affiliated with Cerca Trova Restaurant Group, which has operated Outback Steakhouse restaurants across several western states, including California, Arizona, Nevada, Colorado and New Mexico.
The proposed acquisition could bring the franchisee-operated restaurants under Bloomin' Brands' control if the company prevails in the court-supervised sale process.
CLICK HERE TO GET FOX BUSINESS ON THE GO
Bloomin' Brands also owns Carrabba's Italian Grill, Bonefish Grill and Fleming's Prime Steakhouse & Wine Bar.
Reuters contributed to this report.
Continue reading...
[ H/T Fox Business ]
