American steakhouse Sizzler has filed for Chapter 11 bankruptcy protection owing to the downturn among casual dining restaurants as a result of the coronavirus. Sizzler, founded in 1958, is one of the oldest steakhouses in the U.S.
As a result of the financial troubles caused by the pandemic Sizzler said it could no longer afford to keep up debt payments. The company said in a statement forced closures as a result of the pandemic and the unwillingness of its landlords to provide "necessary rent abatements" forced it to file for bankruptcy.
Sizzler USA, which has about 270 restaurants in the U.S., said the bankruptcy filing doesn't necessarily mean the end of the company. It elected to file for bankruptcy as a way to contain its debts. This will be the second time Sizzler has filed for bankruptcy protection. Its last filing was in 1996 which resulted in the closure of 130 of its U.S. restaurants.
The company said it was still negotiating with landlords for about 14 of its company owned locations. However, it will likely be forced to close down some underperforming outlets.
Around 90 restaurants operated by franchisees will likely remain unaffected by the filing. Restaurants bearing the company's branding outside of the U.S. will also not be affected. In 2011, Sizzler restaurants outside of the country were bought out by Australia-based Collins Foods.
Sizzler was a household name in the U.S. in the 1970s and 1980s. The company's restaurants are mostly in the west of the country. The restaurant is known for its steaks, seafood and unlimited salad bars.
During the height of the pandemic, Sizzler was forced to close restaurants like other buffet-style establishments. According to Restaurant News, Sizzler reopened at least 41 of its dine-in locations with around 38 offering outdoor seating.
The company's ability to bounce back has been hindered by most of its locations being in California - which recently extended its restrictions for indoor dining because of an increase in coronavirus cases.
