Faced With Heavy Financial Woes, Corner Bakery Files For Bankruptcy
Love it or hate it, Corner Bakery has become a staple for many. Is its fare a stunning example of the culinary arts that treads new ground? Many people might say no. But the food they offer could be described as reliable, consistent, and ultimately satisfying. Corner Bakery is one of those places where there is something for everyone, even if that something isn't someone's favorite.
Founded in Chicago in 1991 by Lettuce Entertain You Enterprises, Corner Bakery is an all-day restaurant covering breakfast through dinner. Coffee drinks, pastries, sandwiches and wraps, soups, and even pasta bolster a menu that is — if not inventive — agreeable to most palates. Lettuce Entertain You handed off the brand to seasoned restaurant industry titan Brinker in 1995, who subsequently sold the chain a decade later to CBC Restaurant Corporation. From there, it was purchased by a subsidiary of Roark Capital Partners, becoming one of the many fast-casual chains owned by faceless private equity firms.
Like many restaurants, though, Corner Bakery was battered by the pandemic and the closure of dining rooms and staffing shortages that came along with it. Thus, the ubiquitous chain has made a decision that seems shocking to some.
Seeking protection
Despite its popularity, Corner Bakery has filed for Chapter 11 bankruptcy protection following a move by SSCP Restaurant Investors to take control of the company through the acquisition of debt, reports Restaurant Business News. The chain has $33.8 billion in debt that originated from the sale of Corner Bakery to Pandya Group by Roark Capital Partner in 2020.
The pandemic has largely fueled the decline in Corner Bakery's fortunes. The chain's inoffensive and expansive offerings proved to be a hit with office workers, leading to its popularity as an affordable catering option for meetings and other work functions. But as workers shied away from the office to halt the spread of COVID, Corner Bakery's sales were stunted.
Chapter 11 bankruptcy is a legal process that allows a business to restructure its debts and operations to avoid complete liquidation. In the case of Corner Bakery, which has been facing financial difficulties and struggling to pay its creditors, the process offers time to reorganize finances, renegotiate leases and contracts, and potentially sell off assets to raise cash. Throughout the process, though, Corner Bakery will be allowed to continue to operate while working on a plan to become financially stable and emerge from bankruptcy.