Outback Franchisee Out West Files for Chapter 11 Bankruptcy
Out West Restaurant Group, a major Outback Steakhouse franchisee, filed for Chapter 11 bankruptcy in Delaware. Parent company Bloomin' Brands has submitted a $26.3 million acquisition bid.
Out West Restaurant Group, one of the largest franchisees of Outback Steakhouse, filed for Chapter 11 bankruptcy protection on Monday in a Delaware court. The parent company, Bloomin' Brands, is moving to acquire the restaurants and expects to be selected as the stalking-horse bidder, setting the baseline for competing offers.
Based in San Diego, Out West operates 61 Outback Steakhouse locations across five western US states. In its court filings, the company reported estimated assets and liabilities between $10 million and $50 million each. Among its largest unsecured creditors is Performance Food Group with a claim exceeding $4 million, alongside Matern Law Group with over $1.6 million. All restaurants will remain open and operational throughout the restructuring process.
Bloomin' Brands has provided Out West with a $5.5 million debtor-in-possession (DIP) financing facility to support ongoing operations. Simultaneously, Bloomin' submitted a $26.3 million conditional bid to acquire the company's assets. The purchase price will be reduced by any outstanding DIP loan amounts and could increase if certain vendor liabilities at closing fall below $6.1 million. Bloomin' stated that the bankruptcy filing is an isolated event and will not impact its own corporate operations or financing.
Founded in 1992 as T-Bird Restaurant Group, Out West played a pivotal role in expanding Outback to the West Coast. The company was acquired by private equity firm H.I.G. Capital in 2015 and later rebranded. The restructuring comes as Outback Steakhouse shows signs of recovery following a $75 million investment aimed at improving food quality, marketing, and service.
