Out West Restaurant Group, a major franchisee operating Outback Steakhouse locations across the western United States, filed for Chapter 11 bankruptcy protection in Delaware on Monday [1]. The franchisee operates 61 restaurants affiliated with Cerca Trova Restaurant Group across several western states, including California, Arizona, Nevada, Colorado, and New Mexico [1]. In response, parent company Bloomin' Brands has entered into an agreement to acquire Out West's assets for approximately $26.3 million, subject to certain adjustments and the assumption of specified liabilities, and will serve as the "stalking-horse" bidder in the bankruptcy sale process [1].
To support operations during the Chapter 11 proceedings, Bloomin' Brands agreed to provide up to $5.5 million in interest-free debtor-in-possession financing, subject to court approval [1]. The transaction remains subject to bankruptcy court approval, and Out West intends to continue operating its restaurants throughout the bankruptcy process [1]. Bloomin' Brands stated that the filing would have no immediate impact on customers, restaurant employees, or daily operations at the affected Outback Steakhouse locations [1].
The proposed acquisition represents an opportunity for Bloomin' Brands to consolidate control over previously franchisee-operated restaurants under its direct management [1]. The company, which also owns Carrabba's Italian Grill, Bonefish Grill, and Fleming's Prime Steakhouse & Wine Bar, could expand its portfolio of company-operated locations if it prevails in the court-supervised sale process [1].
CONCLUSION
Bloomin' Brands is positioned to acquire 61 Outback Steakhouse locations from bankrupt franchisee Out West Restaurant Group for $26.3 million, with the transaction subject to bankruptcy court approval. The parent company's provision of $5.5 million in debtor-in-possession financing and commitment to maintain operations suggests continuity for customers and employees during the restructuring process.