Restaurants Unlimited

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Summary

Chief Restructuring Officer

Seattle, WA

Restaurants Unlimited was a 50-year-old company that operated over 40 fine-dining and casual dining restaurants across multiple concepts in the Pacific Northwest.

Facing declining performance due to industry-wide sales challenges, wage increases, and unprofitable new investments, Restaurants Unlimited engaged Carl Marks Advisors (CMA) to develop an in-court restructuring plan. CMA implemented strategies to preserve cash flow, conducted a detailed performance review of each location, and identified cost-saving opportunities to create a right-sized cost structure. The plan focused on a pro-forma entity with a smaller, profitable footprint, leading to a Chapter 11 filing and the successful sale of 25 strong-performing locations to a strategic buyer within a 90-day sale process.

 

Key Challenges
Highly Competitive Market
Industry-Wide Declining Sales
Large Deferred CapEx Requirements
Over-Expansion
Unprofitable and Underperforming Locations
Outsized Overhead Expenses
State Mandated Wage Increases

Engagement Highlights

Phase I – Assess the Business Performance

  • Reviewed the cash flow of the business and implemented strategies to preserve cash and extend the runway to maximize options and value for the Company and its senior lenders.
  • Performed a restaurant-by-restaurant review, understanding sales and cost trends, the market environment, and a review of any deferred and investment CapEx needs. 
  • Evaluated the overhead cost structure, identified areas where savings could be achieved, and developed a right-sized cost structure for the existing and pro-forma businesses.

Phase II – Restructure the Business and Re-Capitalize the Business

  • Developed the rationale for a pro-forma entity, with a smaller footprint of strong performing, cash flow positive locations that would be attractive to investors or lenders. 
  • Prepped and filed the Company for Chapter 11 bankruptcy protection, while assisting management. in exiting a number of its non-performing locations and supported the Company as it prepared to go to market.
  • Supported the Company and management through a 90-day sale process, which resulted in the sale of 25 locations (in-line with CMA’s strategic review) to a strategic buyer.

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