Red Lobster is holding an auction to sell off everything from over 50 restaurants nationwide. Items up for grabs include furniture, supplies, and kitchen equipment.
The auction will cover Red Lobster's locations in 21 different states. Interested buyers can bid on the contents of these restaurants.
Massive Auction of Red Lobster Contents
TAGeX, a company specializing in restaurant liquidations, has labeled the upcoming sale "the largest restaurant equipment auction ever." According to their announcement, over 50 Red Lobster restaurants across the United States have been closed, and their contents are now up for auction.
The auction, hosted on TAGeX's Restaurant Equipment marketplace, offers a unique "winner takes all" approach. The highest bidder for each location will acquire everything from kitchen gadgets to dining furniture.
Interested buyers have until May 16 to bid on these Red Lobster locations.
Meanwhile, The U.S. Sun reports that several Red Lobster employees have taken to social media to express their frustrations after unexpectedly losing their jobs following the sudden closure of multiple restaurant locations.
On X, previously known as Twitter, one employee shared, "I lost my job today without warning and working Mother's Day yesterday."
Another employee remarked on their relatively better situation than others, stating, "I'm one of the lucky ones who don't have kids or a house to pay off. It is terrible leaving all those employees with nothing, no notice."
It is estimated that about 6,500 employees have been affected by these closures, with over 80 Red Lobster restaurants now listed as "temporarily closed." In Bossier City, Louisiana, a restaurant displayed a stark message on its entrance: "This location is closed."
Red Lobster Faces Potential Bankruptcy Amid Financial Struggles
Red Lobster is reportedly on the brink of bankruptcy, and Bloomberg reports that it is bringing in restructuring experts. This move has fueled speculation about a possible Chapter 11 bankruptcy filing.
Filing for bankruptcy would allow Red Lobster to overhaul its operations, potentially cutting off expensive leases and lowering labor costs.
This comes after a tough financial quarter last year, where the seafood chain reported a loss of $11 million in Q3, significantly impacted by its "Unlimited Endless Shrimp" promotion. While the $20 deal was popular among customers, it was financially detrimental for the company.
Thai Union Group, which owns a 49% stake in Red Lobster, has been attempting to offload its shares due to the negative impact on profits from various challenges such as the pandemic, ongoing industry pressures, high interest rates, and escalating costs for materials and labor.
The group has stated that Red Lobster's ongoing financial issues are no longer compatible with its business goals.
Ludovic Regis Henri Garnier, CFO of Thai Union Group, acknowledged the pricing miscalculation with the shrimp deal. "We knew the price was low, but the idea was to bring more traffic into the restaurants," Garnier explained to investors, as reported by Restaurant Business.
This isn't the first time Red Lobster has faced such a predicament. In 2003, the restaurant introduced an "Endless Crab" deal, resulting in a significant loss of $405.9 million in stock value in a single trading session and a $3.3 million drop in profits.
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