More Restaurant Bankruptcies: Bar Louie Closes 38 Locations Amid Chapter 11 Filing

Gastrobar chain Bar Louie filed for Chapter 11 bankruptcy protection on Monday and has reportedly closed as many as 38 out of 134 locations.

As a result of the Chapter 11 filing, Bar Louie, which is known for its crafted cocktails and expansive beer collection, has entered into an agreement with its lenders, which will act as the stalking horse purchasers of the company. The amount of the bid was not disclosed by the company, but it is subject to higher offers.

Bar Louie does not expect the Chapter 11 filing to affect its day-to-day business, but it has made the decision to close “underperforming locations” to help strengthen both its financial and operational position. The company said it will continue to operate more than 90 locations across the U.S.

With about $110 million owed to its creditors, Bar Louie has secured debtor-in-possession financing that it said will allow it to continue to operate and fund its bankruptcy filing while supporting the purchase from its lenders, Restaurant Business reported. Bar Louie will also continue to meet is financial obligations to employees and suppliers during the Chapter 11 process.

“Bar Louie is a profitable business focused on long-term growth with new investors,” Tom Fricke, CEO at Bar Louie, said in a statement. “The sale through Chapter 11 will help us to focus on our profitable core locations and expand in areas that have a proven track record of success,"

“Most importantly, it ensures that we can continue to provide superior service to our guests, implement an exciting range of new customer-facing initiatives, expand our marketing influence, and continue to offer the 5-star experience we are known for.”

Bar Louie said it expects to emerge from bankruptcy within 90 days. The brand is a holding of Sun Capital Partners and has restaurants in 26 states.