Culture news and discussion on TalkFuse.
California-based restaurant chain operator files for bankruptcy as it blames state’s brutal wage laws
Outback Steakhouse franchise operator Cerca Trova Restaurant Group has filed for Chapter 11 bankruptcy protection, citing falling customer traffic and rising food and labour costs. The filing highlights the financial strain facing a major restaurant operator, while California’s wage rules have become part of a wider debate over pressures on the state’s restaurant industry.
The San Diego-based company operates 61 Outback restaurants across five states, mostly in California, and is seeking relief from $449 million in debt. Its debt rose from about $269 million in 2020; beef costs have increased by as much as 5% a year since 2022. Bloomin’ Brands, Outback’s parent company, has offered $26.3 million for the operator’s assets and up to $5.5 million in financing, while saying the bankruptcy will not affect its wider operations.
In short
- Outback franchise operator seeks bankruptcy protection with $449 million in debt.
- It says falling traffic and rising costs have worsened its finances.
- Outback’s parent company is the leading bidder for its remaining restaurants.