Hooters, the well-known restaurant chain, declared bankruptcy on March 31, 2025. The restaurant, famous for its female waitresses in orange uniforms and chicken wings, is struggling financially and using bankruptcy to reorganize its business.
However, Hooters’ move does not mean the company is completely shutting down. The decades-old brand said it is not going anywhere. Instead, it plans to sell all 100 of its restaurants directly.
These 100 company-owned restaurants will be sold to two groups of franchise owners. One is based in Tampa, Florida, and the other is in Chicago. According to the company’s press release, these two franchise groups already run about one-third of the Hooters U.S. restaurants owned by franchises. By selling these restaurants, the company hopes to keep the brand alive. Hooters hopes to keep the business running while dealing with its financial troubles.
Hooters’ Struggles
Like some other fast-casual restaurants, Hooters is facing serious financial trouble. Like BurgerFi and Red Lobster, it is filing for bankruptcy because business conditions have been tough.
Hooters has also been dealing with lawsuits. Many of these lawsuits were filed by employees who accused the company of unfair treatment, and many of these complaints were based on race and gender discrimination.
Another struggle the company faced was shutting down many locations last year. Hooters made this move because of the rising prices of goods and services. It became too expensive for the company to pay for food production and workers’ wages. However, despite these problems, the company still has positive expectations. Hooters says it expects to recover from bankruptcy in 3 to 4 months.
The company’s CEO, Sal Melilli, stated the purpose of the bankruptcy process. Melilli mentioned that the process is meant to help strengthen the company’s finances so that it can continue serving customers.
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Hooters’ Comeback Plans
Hooters filed for Chapter 11 bankruptcy in a Texas court. A Chapter 11 bankruptcy will help the business reorganize and allow it to try to fix its financial issues instead of shutting down completely.
The food chain discussed its comeback plans. It said it would continue to operate its business as usual. However, it also mentioned that it is “evaluating the company’s operational footprint.” Hooters will be doing this for its company-owned locations. This means it may end up closing some locations during the bankruptcy process.
Private equity firms Nord Bay Capital and TriArtisan Capital Advisors bought Hooters in 2019. The buyer group includes the original Hooters founders, including Neil Kiefer, CEO of the franchise group Hooters Inc.
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“For many years now, the Hooters brand has been owned by private equity firms and other groups. These groups had no history or experience with the Hooters brand,” Kiefer said in the press release on March 31.
In a recent interview, Neil Kiefer mentioned some of the company’s comeback plans. He said that the plan includes making the fast-casual restaurant chain more family-friendly. He also mentioned that the buyout, which the founder leads, will allow the brand to go “back to its roots.” Even though 44 Hooters restaurants have been closed down, with its comeback plan, the restaurant said the “renowned Hooters restaurants” are here to stay.