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It could be the end of an era for the popular seafood chain Red Lobster, which officially filed for bankruptcy on Monday after months of speculation and dozens of abrupt restaurant closures.
Now the company is reaching out to its loyal customers — and investigating what role its shrimp supplier may have played in its demise.
Related: Red Lobster suddenly closes dozens of locations without warning employees and begins auctioning off equipment
In a letter posted on social media, Red Lobster thanked its customers for their nearly five decades of loyalty and assured the masses that the chain would not disappear.
We are here to celebrate every moment, big or small, with our valued guests. pic.twitter.com/JmAoNGP4a8
— Red Lobster (@redlobster) May 21, 2024
“Bankruptcy is a word that is often misunderstood. Filing for bankruptcy does not mean we are going out of business,” Red Lobster wrote. “In fact, it means exactly the opposite. This is a legal process that allows us to make changes to our business and cost structure so that Red Lobster can continue to be a stronger company.”
Red Lobster noted that after filing for Chapter 11 (Delta in September 2005, Hertz in May 2020), companies like Delta Airlines and Hertz “emerged stronger” and found ways to get back on their feet.
“Birthdays, graduations, anniversaries and yes, weddings. We were there for all of them,” the chain wrote. “Red Lobster is committed to being there for these moments for generations to come.”
Red Lobster's decline was a slow process, largely due to an $11 million loss in November 2023 due to the chain's launch of an “Endless Shrimp” promotion. Offering customers all the shrimp they could eat for $20, the deal proved a little too popular.
Last week it was reported that stores across the country were closing without warning, dozens were auctioning off all of their furniture and appliances online, and some employees claimed they were not informed in advance.
In a filing Sunday, Red Lobster CEO Jonathan Tibus took aim at former CEO Paul Kenny and Red Lobster's seafood supplier and owner, Thai Union, over decisions related to the Endless Shrimp promotion and that Red Lobster “The circumstances are currently being investigated.” the decision to make the promotion permanent rather than temporary.
Related: Endless Shrimp Deal Is Too Popular, Red Lobster Loses $11 Million
“I understand that Thai Union has had an outsized influence on the company’s shrimp purchasing,” Tibus wrote. “[Red Lobster is] To examine the impact of the control exercised by Thai Union, in collaboration with Mr. Kenny and other companies and individuals affiliated with Thai Union, and whether the actions taken, given the different interests of these parties, are appropriate and consistent with applicable duties and obligations to Red Lobster were compatible.”
Thai Union completed its purchase of Red Lobster in 2020.
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