BurgerFi announced Monday that it finalized a sale out of bankruptcy to lender TREW Capital Management.
BurgerFi sold for a $10 million credit bid and assumption of liabilities and Anthony’s Coal Fired Pizza & Wings sold for a $44 million credit bid and assumption of liabilities. The sale of Anthony’s finalized on November 15, followed by the BurgerFi asset sale on November 27.
Following the sale, BurgerFi CEO Carl Bachman exited the company on November 15, joining TREW as part of the Anthony’s acquisition. The company clarified that Bachman’s departure was amicable and unrelated to operational disagreements.
In April, TREW took over as primary lender.
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BurgerFi revealed in September that it planned to sell its assets through bankruptcy proceedings after unsuccessful out-of-court attempts.
The company filed for Chapter 11 bankruptcy protection in the U.S. District Court in Delaware, listing assets between $50 million and $100 million and debts ranging from $100 million to $500 million. The filing affected 67 corporate-owned units, while franchisee-owned locations remained operational and were excluded from the proceedings. Before the bankruptcy, the company closed 19 underperforming corporate-owned stores—10 BurgerFi and nine Anthony’s locations—to streamline operations.
The company’s financial challenges were attributed to rising labor and food costs, increased unemployment, higher interest rates, and declining consumer spending, all of which have pressured margins and led to significant losses.
As of September, BurgerFi had 93 stores nationwide (76 franchised and 17 corporate), which is its lowest restaurant count since well before the pandemic. It’s a decrease from the 102-unit total (75 franchised and 27 corporate) at the end of Q1. Anthony’s had 51 restaurants (50 corporate-owned casual restaurant locations and one dual-brand franchise location with BurgerFi). That’s a decrease from 60 locations at the end of Q1.
BurgerFi, which went public via a SPAC in 2020 and acquired Anthony’s in 2021 for $161 million, has struggled post-COVID, with same-store sales falling 8 percent in 2023 and 9 percent in 2022. In Q1 of 2024, comps dropped 13 percent and systemwide sales decreased by 17 percent. Bachmann, who became CEO in July 2023, introduced a five-point plan to revamp the brand by updating infrastructure and technology, improving the menu, redefining the store footprint, implementing operational gold standards, and boosting brand awareness.
In 2023, the combined company experienced an $8.6 million year-over-year decline in revenue. Royalty and other fees decreased $2.2 million or 23 percent, due to a 6 percent drop in franchise restaurant comps. Also, the restaurant group experienced a net loss in 2022 and 2023—$103.4 million and $30.7 million, respectively.
