Taco Bueno chief executive officer Omar Janjua called it, “a new beginning” for the Tex-Mex brand. When Taco Bueno filed for federal bankruptcy protection in November, it also said it struck an agreement with Taco Supremo, LLC, an affiliate of Sun Holdings, Inc. The company announced January 15 that it completed that deal and successfully emerged from its court-supervised financial restructuring. Through the restructuring process, Taco Bueno said, the chain “substantially improved its financial position and established a sustainable capital structure.”
Before the Chapter 11 filing, the Sun Holdings affiliate acquired all of Taco Bueno’s outstanding bank debt and provided a commitment for up to $10 million in debtor-in-possession financing that would support Taco Bueno’s operations during the financial restructuring process. Under the terms, Sun Holdings then would become the owner of Taco Bueno through a debt-for-equity swap.
According to filings, Taco Bueno claimed between $10 million and $50 million in assets and between $100 million and $500 million in liabilities.
Sun Holdings is a multi-concept franchisee based in Dallas with more than 800 locations across eight states that also includes Burger King, Popeyes, Arby’s, Golden Corral, Cici’s Pizza, Krispy Kreme, GNC, and T-Mobile. This is how it broke down at the time of the deal: 296 Burger Kings, 145 Popeyes, 87 Arby’s, 21 Golden Corrals, 32 Cici’s Pizzas, and 18 Krispy Kreme stores.
“With our sale to Sun Holdings and our financial restructuring completed, we are well positioned for long-term financial health as we grow our food offerings and brand with the added expertise and leadership of Sun Holdings. I’d like to thank our dedicated employees for their commitment to Taco Bueno through this process, and we look forward to continuing to serve freshly prepared meals, in real kitchens, using real ingredients and providing unmatched customer service to guests,” Janjua said in a statement.
Taco Bueno’s plan of reorganization was confirmed by the U.S. Bankruptcy Court for the Northern District of Texas on December 31. In September, the chain announced that it shuttered 16 restaurants across Texas, Oklahoma, Kansas, and Missouri, following an in-depth review of the company’s entire portfolio. At the time of November announcement, there were 169 units. Taco Bueno said in Tuesday’s release that there were more than 145 restaurants throughout the American South and Southwest, including Arkansas, Oklahoma, and Texas.
“We have a proven track record of successfully growing brands in this industry, and we are excited about leveraging our experience to reinvigorate Taco Bueno with new food offerings and streamlined marketing initiatives to strengthen its competitive position in the quick-service restaurant sector,” added Guillermo Perales, chief executive officer and founder of Sun Holdings, in a statement, “We look forward to working closely with the Taco Bueno team to build on the company’s 50-year history and execute swiftly on our key priorities of food quality and enhanced value for customers, employees and the brand.”
In November, Taco Bueno said Sun Holdings would invest in remodeling locations, increasing brand initiatives, and enhancing the customer experience. It would also “continue to focus on initiatives to grow the Taco Bueno brand, while remaining true to our roots, delivering great-tasting meals to our customers in an inviting and comfortable environment,” Janjua said.
Taco Bueno was founded in 1967 in Abilene, Texas. In December 2015, TPG Growth, the middle market and growth equity investment platform of TPG, purchased then-177-unit Taco Bueno for an undisclosed amount. Janjua left the same post at Krystal to join Taco Bueno in March and oversee a team of corporate executives and more than 2,700 employees from its headquarters in Irving, Texas. Taco Bueno relocated to the larger base in 2017.
Janjua brought more than 35 years of quick-service experience to the position. Before Krystal, he was president and COO for Sonic, where he oversaw operations, training, franchising, developing and quality assurance. Janjua also served as vice president and chief operating officer at Steak ‘n Shake after 18 years with Pizza Hut, where he provided support to 75 franchise groups operating 2,600 restaurants in 27 states.
Taco Bueno said earlier in the year it would focus on its core business and providing Tex-Mex for lunch and dinner through a new customer-inspired menu. One example was a Pick 3 for $2.99 Menu, introduced in March, where customers could build a combo meal under the $3 price point.