Red Lobster is closing over 50 of its locations across the United States, as confirmed by a restaurant liquidator. TAGeX Brands will be conducting auctions for furniture and kitchen items from these closing establishments. Bloomberg had previously reported on the chain's contemplation of a bankruptcy filing.
TAGeX Brands, the restaurant liquidator, confirmed to Business Insider on Monday that it will be auctioning off kitchen items and furniture from the closing Red Lobster locations. The auction started on Monday and is scheduled to end on Thursday. Neal Sherman from TAGeX Brands mentioned that four sales were already completed on Monday.
"TAGeX Brands is conducting the largest restaurant equipment auction event ever, auctioning off the contents of 50+ former Red Lobster locations across the country that were closed as part of Red Lobster's footprint rationalization," the company stated in a message to BI. Red Lobster has not made a public statement regarding these closures and did not immediately respond to Business Insider's request for comment.
According to the Red Lobster website, the locations listed by TAGeX Brands for liquidation appear to be closed for the rest of the week. Local outlets from Orlando to Buffalo reported that these locations were listed as "temporarily closed" on the website. States affected by the closures include California, Colorado, Florida, New York, and Texas. The company, which has over 700 locations, has not clarified if this total reflects the recent closures.
Over its 56-year history, Red Lobster has faced financial challenges. The chain, founded in Florida, attributed $11 million in losses in the third quarter of 2023 to its all-you-can-eat shrimp promotion. Additionally, the restaurant reported significant sales declines in March 2020 during the initial Covid-19 lockdowns.
In April, Bloomberg reported that Red Lobster was considering filing for Chapter 11 bankruptcy protection. Retail experts, previously interviewed by Business Insider, pointed to some of the company's struggles being linked to the private equity firm Golden Gate Capital, which acquired the business in 2014. Golden Gate Capital sold Red Lobster's real estate holdings in the same year to another company to help fund the deal, later leasing those restaurants back, which has been costly for the brand.
In recent years, the company has also experienced leadership instability, with several Red Lobster executives leaving their roles. If you found this story interesting, be sure to follow Business Insider on Microsoft Start.