FAT Brands, the Beverly Hills-based parent company of iconic restaurant chains including Fatburger, Johnny Rockets, and Round Table Pizza, is poised to potentially sell off some of its most well-known brands as it navigates complex bankruptcy proceedings. The company, which filed for Chapter 11 protection in late January, has sought court approval to market and sell all or portions of its assets, according to recent legal filings.
Bankruptcy Court Approves Asset Sale Process
In documents submitted to the U.S. Bankruptcy Court for the Southern District of Texas, FAT Brands has outlined procedures for what could become an open auction of its restaurant brands. The company believes these bidding procedures will "maximize value while providing parties in interest with a level playing field" for potential acquisitions. Interested companies have until April 3 to submit indications of interest to the court, though it remains unclear which entities might pursue the well-known restaurant concepts.
Financial Challenges and Debt Burden
The company's financial troubles have been mounting for some time. FAT Brands faces estimated debts ranging from $1 billion to $10 billion, a staggering figure attributed partly to recent acquisitions and complex debt arrangements. By late 2025, the company was confronting approximately $1.26 billion in debts it could not service, despite attempts to restructure by separating brands like Twin Peaks and Smokey Bones into a different corporate entity.
CEO Andy Wiederhorn emphasized that the Chapter 11 process represents an opportunity to "strengthen our capital structure" and ensure the company's concepts "remain at the forefront of their sectors." He noted that the company's portfolio has demonstrated "tremendous resilience in a challenging restaurant operating environment" and expressed confidence in long-term profitability prospects.
Operational Continuity During Proceedings
Despite the financial restructuring, FAT Brands officials have assured customers and employees that restaurants should continue operating normally throughout the bankruptcy process. The company operates approximately 18 restaurant brands with more than 2,200 locations worldwide, employing over 45,000 corporate and franchise staff members. Wiederhorn stressed that maintaining quality service and supporting franchise partners remains a primary focus during this transitional period.
Stock Market Consequences and Future Trading
The bankruptcy filing has triggered significant consequences in financial markets. Nasdaq announced that trading of FAT Brands and affiliate Twin Hospitality stocks would cease on February 4, with shares being removed from the exchange due to bankruptcy and public-interest concerns. The company does not contest this decision and expects its shares to transition to the over-the-counter Pink Market. This follows previous warnings about the stocks trading below $1 for extended periods.
FAT Brands is seeking joint administration of its Chapter 11 cases alongside affiliate Twin Hospitality and related subsidiaries. The company's dynamic portfolio, which has expanded through strategic acquisitions in recent years, now faces its most significant test as it attempts to restructure finances and reduce liabilities through potential asset sales.
