Red Lobster in Ontario court to discuss U.S. bankruptcy case, Canadian assets: docs

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Red Lobster in Ontario court to discuss U.S. bankruptcy case, Canadian assets: docs
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A lawyer for Red Lobster Canada, Inc. says he will ask an Ontario court today to recognize and enforce the chain’s U.S. bankruptcy protection proceedings.

A lawyer for Red Lobster Canada , Inc. says he will ask an Ontario court today to recognize and enforce the chain’s U.S. bankruptcy protection proceedings, a process which documents show could include selling Canadian assets.

“With a looming liquidity crisis and no meaningful ability to raise fresh capital, the RL Group’s board of directors … determined that a value-maximizing sale would be the best possible alternative,” the filing from Jonathan Tibus says.Red Lobster, which expanded to Canada in 1983, has 2,000 Canadian employees, who are mostly part-time, non-unionized and working at the chain’s 27 locations across Ontario, Alberta, Manitoba and Saskatchewan.

The stay came as Florida-based Red Lobster Management LLC filed for Chapter 11 bankruptcy protection in the U.S. The American company had already shuttered dozens of locations while it grappled with rising costs. Tibus labelled it a “significant cash drain” that a separate filing from the company said cost Red Lobster US$11 million.New Brunswick premier bans sex ed group from schools over ‘inappropriate’ presentation

However, Tibus said the brand is still facing “significant liquidity and operational challenges, which were exacerbated and accelerated by significant over-market and underperforming leases and poor operational and marketing decisions by prior management.”

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