Category: Bankruptcy News (Page 2 of 8)

A Home Improvement Company Now Files An Unexpected Bankruptcy

A home improvement company now files an unexpected bankruptcy, leading the struggling business with plans to liquidate.

Common Living has filed for Chapter 7 bankruptcy and plans to liquidate.

The company, which filed its bankruptcy petition in U.S. Bankruptcy Court in Delaware, plans to sell as much as $10 million of assets, with the proceeds distributed to creditors, according to the bankruptcy filing.

Common Living has between $10 million and $50 million in liabilities.

Much like coworking pioneer WeWork, Common Living tried to solve a problem.

Coworking and co-living spaces solved that problem.

In a co-living situation, at least with Common Living, members get a private bedroom and access to common living, kitchen and bathroom areas.

They get a clean and safe place to sleep and room to socialize as much or as little as they choose for a price lower than the rent on an apartment.

The company shared its mission on its website.

“Common is creating better living through convenience and community,” it said.

“We keep the good parts of shared housing while removing the annoyances. Common members know their neighbors, meet new people, and save money.

Being a Common member means never having to worry about cleaning, moving furniture, or splitting the bills.”

The company currently operates in 12 cities across the U.S. and Canada and manages a total of 79 co-living communities, the website shows.

The Common Living website currently shows 18 listings for available space in properties in New York City, the Commercial Observer reported.

Common Living tried to create a community for the people living in its homes.

“With access to Connect by Common’s directory, members have the opportunity to truly know their neighbors and enjoy all the benefits of shared living,” the website says.

“By filling out their profile, members can find each other based on city, home, or interest tags.

It’s communal living made easy.”

However, the company did not answer the Commercial Observer’s request for comment and has not said what happens to current residents of its properties, per TheStreet.

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Also Read: Another Mall Clothing Retailer Now At High Risk of Bankruptcy

Other Economy News Today

Market News Today - A Home Improvement Company Now Files An Unexpected Bankruptcy.
Market News Today – A Home Improvement Company Now Files An Unexpected Bankruptcy.

An essential company now files a surprising bankruptcy after miscalculating demand for its inventory after the Covid-19 pandemic.

Supply Source Enterprises, a leading provider of branded and private label cleaning products and personal protective equipment, on May 21 filed for Chapter 11 protection to seek a sale of its assets.

Supply Source brands include The Safety Zone and Impact Products.

The Guilford, Connecticut debtor listed $50 million to $100 million in assets in its petition and $180 million in funded debt, which includes $80 million owed on a term loan credit facility, $60 million owed on an asset-based loan, and about $40 million in unsecured debt.

Before the Covid-19 pandemic, which generated huge demand for cleaning supplies and personal protective equipment in 2020, Supply Source had been consistently profitable with stable single-digit growth, according to a declaration from the debtor’s Chief Restructuring Officer Thomas Studebaker.

Once the pandemic hit in 2020, the debtor had substantial growth due to high demand for safety, hygiene and sanitation products

The debtor reported adjusted Ebitda of $93 million in 2020 which was nearly a 300% increase over the previous year.

However, the company’s financial performance deteriorated in subsequent years.

Based on the unprecedented demand in 2020, the company commissioned an industry study in early 2021 that concluded that the Covid-19 pandemic would fundamentally change the cleaning supplies and protective equipment industry and market for its products.

The study also estimated that the company’s Covid-related growth would likely be sustained through 2024.

In contemplation of continued customer demand at elevated prices, based on the study’s data, the debtor increased purchases of inventory even though the costs were higher due to supply chain constraints during the pandemic.

Despite the study’s assurance that growth would be sustained for years, the pandemic’s positive effect on the market faded by the end of 2021 and demand for PPE decreased to normal rates, reports TheStreet.

The reduction in demand led to large amounts of excess inventory that the company could not sell in the same quantities and prices.

The excess inventory forced the debtor to secure additional storage space, which increased storage costs.

These factors tightened the company’s liquidity and led to a decline in annual revenue in 2023 by 26% from 2022, resulting in a negative 2023 Ebitda of $13 million.

The debtor’s liquidity issues led to it being overdrawn on its asset-based loan facility by $30 million.

The ABL lender in February 2024 swept the debtor’s bank accounts, further impacting the company’s financial distress.

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Also Read: This Massive Mall Retailer Is Now Closing In California

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Company in Texas is Now Laying Off Whopping 4,000 Employees

A company in Texas is now laying off a whopping 4,000 employees as a giant company files for Chapter 11 bankruptcy.

Zachry Holdings, a conglomerate with subsidiaries in construction, energy, and other industries, filed for Chapter 11 bankruptcy protection last month.

The move allowed the company to pursue a “structured exit” from its partnership to build a $10 billion liquified natural gas terminal in Sabine Pass.

However, in the wake of the bankruptcy filing, Zachry Holdings has issued layoff notices to the Texas Workforce Commission.

The notices detail massive layoffs in Texas.

A whopping 4,072 employees are now set to lose their jobs in Sabine Pass alone.

An additional 307 positions are being terminated in Baytown, with another 15 job cuts happening in Beaumont.

Addressing the company’s precarious situation, Chairman and CEO John B. Zachry cited “significant challenges and disruptions” that have taken a heavy toll. He pointed to the COVID-19 pandemic as the initial catalyst, which was then compounded by “international geopolitical issues” straining the company’s resources and operations.

“These events have resulted in significant financial strain while meeting targets and keeping the [Sabine Pass] project appropriately staffed,” stated the company.

As Texas braces for the economic fallout, state officials and workforce development organizations are preparing support services for the thousands of displaced workers.

The massive layoffs in Texas represent a heavy blow to local communities that have relied on Zachry Holdings’ operations as a major employment hub.

Layoffs in Texas continue to grow this year as more businesses file WARN notices advising of upcoming job cuts in the state.

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Also Read: Retirees Will Now Receive More Money For Social Security

Other Economy News Today

Market News Today - Company in Texas is Now Laying Off Whopping 4,000 Employees.
Market News Today – Company in Texas is Now Laying Off Whopping 4,000 Employees.

Applications for unemployment benefits now surge to new highs, a sign that the white-hot labor market is starting to cool off.

First-time applications for unemployment benefits rose last week to 231,000, the highest level since August, per CNN.

Thursday’s data also showed that the number of continuing claims, or applications from people who have filed for unemployment for at least one week, was 1.78 million.

That’s an increase of 17,000 from the prior week, according to the Bureau of Labor Statistics.

The latest numbers come less than a week after the monthly jobs report showed the US economy added just 175,000 positions in April, less than economists expected and a steep drop-off from prior months.

US employers have now added an average of 245,500 jobs per month, versus 2023’s 251,000-per-month average.

Still, hiring remains strong. Although the unemployment rate ticked up to 3.9% last month, it’s the 27th consecutive month that the jobless rate has held under 4%, matching a streak last seen in the late 1960s.

Weekly jobless claims data tends to be volatile but, while one week’s worth of data “does not a trend make,” said Chris Rupkey, chief economist at Fwdbonds.

“We can no longer be sure that calm seas lie ahead for the US economy if today’s weekly jobless claims are any indication.”

Company layoffs are picking up, hinting at caution on the part of companies as they weigh the outlook for the second half of the year,” he wrote in a note Thursday.

The Federal Reserve has been battling inflation by raising its key lending rate in the hopes of slowing the economy.

While the labor market has so far resisted those efforts, remaining white hot for the past 18 months despite 11 rate hikes from the central bank, Fed Chair Jerome Powell said last week that demand has “cooled from its extremely high level of a couple of years ago.”

Ian Shepherdson at Pantheon Economics said in a note Thursday: “We’d need to see at least a month of elevated readings to convince us that the trend really has turned.”

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Also Read: A Giant Company Now Announces Unexpected Layoffs in Virginia

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Market News Today - Company in Texas is Now Laying Off Whopping 4,000 Employees.
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A Bankrupt Restaurant Is Now Closing 100 More Locations

A bankrupt restaurant is now closing 100 more locations after it already shuttered nearly the same amount just last month.

Red Lobster announced that more than 100 stores are expected to shutter after a disastrous promotion and bankruptcy filing.

The news comes after nearly 100 locations were already shuttered last month, according to bankruptcy filings submitted last week.

The documents listed roughly 228 rejected restaurant leases that Red Lobster said would continue losing money if they remained in operation.

A list of restaurants on the chopping block was also revealed, including the company’s massive restaurant in Times Square in New York City.

The landlords of that location increased the annual rent to $2.2 million, more than double what Red Lobster is believed to be paying, reported The New York Post.

Red Lobster is currently negotiating with the landlords before the lease expires on June 30.

The Times Square location is the last Red Lobster in Manhattan, according to the company’s website.

A location in Harlem closed back in May.

“This is a high-performing store and it’s not closing,” a manager told the outlet.

The chain officially filed for bankruptcy on May 19 after years of struggling due to rising food and labor costs, underperforming locations, and operating costs.

The bankruptcy filing will allow Red Lobster to continue operating while selling off most of its assets to improve the business.

“This restructuring is the best path forward for Red Lobster. It allows us to address several financial and operational challenges and emerge stronger and re-focused on our growth,” said CEO Jonathan Tibus in a statement.

“The support we’ve received from our lenders and vendors will help ensure that we can complete the sale process quickly and efficiently while remaining focused on our employees and guests.”

Red Lobster currently operates 570 locations throughout the US.

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Also Read: An Unexpected Retailer Is Now Closing All Stores in Illinois

Other Economy News Today

Market News Today - A Bankrupt Restaurant Is Now Closing 100 More Locations.
Market News Today – A Bankrupt Restaurant Is Now Closing 100 More Locations.

An unexpected restaurant now abruptly closes 7 locations in one state after revealing plans to shutter a total of 36.

TGI Fridays is closing a total of seven restaurants in one state as part of the company’s ongoing growth strategy.

This comes after the chain abruptly closed 36 locations across 12 states in at the beginning of the year, per The-Sun.

The restaurant chain will pull the plug on seven locations across the state of New Jersey in the coming weeks.

Today, Fridays will welcome in famished diners at its location in Brick for the final time.

“As we continue along our path of transformation to revitalize the Fridays brand and implement a long-term growth strategy, we see a bright future for TGI Fridays,” said Weldon Spangler, CEO of TGI Fridays earlier this week.

“We are at the helm of a pivotal moment that will allow us to explore boundless advancement, expansion, and innovation to keep delivering ‘That Fridays Feeling’ that our fans know and love.”

Before the closures, TGI Fridays had about 270 US locations, according to the company’s website.

“As part of the store closures, TGI Fridays is offering more than 1,000 transfer opportunities, which represents over 80% of total impacted employees,” the company previously said in a statement.

“Our top priority has always been delivering a superior experience for each and every TGI Fridays guest, and we’ve identified opportunities to optimize and streamline our operations to ensure we are best positioned to meet – and exceed – on that brand promise,” said Ray Risley, US president and chief operating officer, in the release.

Eight other locations were sold to former CEO Ray Blanchette, a longtime stakeholder who will acquire the previously corporate-owned restaurants.

The sale comes as major changes have been made to the brand’s leadership, including the news of Weldon Spangler being made CEO.

“As we continue along our path of transformation to revitalize the Fridays brand and implement a long-term growth strategy, we see a bright future for TGI Fridays,” said Spangler in a statement.

Also Read: Retirees Will Now Receive More Money For Social Security

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Market News Today - A Bankrupt Restaurant Is Now Closing 100 More Locations.
Market News Today – A Bankrupt Restaurant Is Now Closing 100 More Locations.

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An Unexpected Restaurant Chain Now Files A Surprising Bankruptcy

An unexpected restaurant chain now files a surprising bankruptcy after announcing the closure of 48 of its locations.

Rubio’s Coastal Grill, a California-based restaurant chain known for its fish tacos, filed for bankruptcy protection on Wednesday.

The company said on May 31 that it had closed down 48 locations in California.

In a statement, Rubio’s blamed the closures on “the rising cost of doing business in California.”

It also operates restaurants in Arizona and Nevada.

Rubio’s has over $100 million in debt, according to a bankruptcy petition filed in the state of Delaware on Wednesday.

It is not the first rodeo in the bankruptcy court for Rubio’s.

In 2020, it also filed for Chapter 11.

Although it survived, Rubio’s closed all of its Colorado, Utah, and Florida restaurants the same year.

A Rubio’s spokesperson cited the “rising cost of doing business” and the “current business climate” in California as key factors behind the closures of its Golden State restaurants.

The 48 affected locations include 24 in the Los Angeles area, 13 in San Diego, and 11 in Northern California.

Although Rubio’s did not explicitly blame the new law, many restaurant industry experts have raised concerns about the state’s new $20 minimum wage for fast food workers.

The law came into effect on April 1.

President and CEO of the California Restaurant Association Jot Condie said: “Daily headlines have chronicled job losses, reduced working hours, restaurant closures, and higher prices for California’s inflation-weary consumers as a direct result of this minimum wage hike.

Feedback from our members suggests this has become a breaking point for many small restaurant businesses.”

Rubio’s was founded in 1983 in San Diego.

It specializes in Mexican food, with an emphasis on fish tacos.

Founder Ralph Rubio was inspired to open a restaurant in his hometown after taking a spring break trip to Mexico during his college days.

He remains chairman of Rubio’s, 41 years after opening his first restaurant.

For more bankruptcy news and updates like this, opt-in for push notifications.

Also Read: Another Mall Clothing Retailer Now At High Risk of Bankruptcy

Other Economy News Today

Market News Today - An Unexpected Restaurant Chain Now Files A Surprising Bankruptcy.
Market News Today – An Unexpected Restaurant Chain Now Files A Surprising Bankruptcy.

An essential company now files a surprising bankruptcy after miscalculating demand for its inventory after the Covid-19 pandemic.

Supply Source Enterprises, a leading provider of branded and private label cleaning products and personal protective equipment, on May 21 filed for Chapter 11 protection to seek a sale of its assets.

Supply Source brands include The Safety Zone and Impact Products.

The Guilford, Connecticut debtor listed $50 million to $100 million in assets in its petition and $180 million in funded debt, which includes $80 million owed on a term loan credit facility, $60 million owed on an asset-based loan, and about $40 million in unsecured debt.

Before the Covid-19 pandemic, which generated huge demand for cleaning supplies and personal protective equipment in 2020, Supply Source had been consistently profitable with stable single-digit growth, according to a declaration from the debtor’s Chief Restructuring Officer Thomas Studebaker.

Once the pandemic hit in 2020, the debtor had substantial growth due to high demand for safety, hygiene and sanitation products

The debtor reported adjusted Ebitda of $93 million in 2020 which was nearly a 300% increase over the previous year.

However, the company’s financial performance deteriorated in subsequent years.

Based on the unprecedented demand in 2020, the company commissioned an industry study in early 2021 that concluded that the Covid-19 pandemic would fundamentally change the cleaning supplies and protective equipment industry and market for its products.

The study also estimated that the company’s Covid-related growth would likely be sustained through 2024.

In contemplation of continued customer demand at elevated prices, based on the study’s data, the debtor increased purchases of inventory even though the costs were higher due to supply chain constraints during the pandemic.

Despite the study’s assurance that growth would be sustained for years, the pandemic’s positive effect on the market faded by the end of 2021 and demand for PPE decreased to normal rates, reports TheStreet.

The reduction in demand led to large amounts of excess inventory that the company could not sell in the same quantities and prices.

The excess inventory forced the debtor to secure additional storage space, which increased storage costs.

These factors tightened the company’s liquidity and led to a decline in annual revenue in 2023 by 26% from 2022, resulting in a negative 2023 Ebitda of $13 million.

The debtor’s liquidity issues led to it being overdrawn on its asset-based loan facility by $30 million.

The ABL lender in February 2024 swept the debtor’s bank accounts, further impacting the company’s financial distress.

For more news and updates like this, opt-in for push notifications.

Also Read: This Massive Mall Retailer Is Now Closing In California

Market News Published Daily 📰

Market News Today - An Unexpected Restaurant Chain Now Files A Surprising Bankruptcy.
Market News Today – An Unexpected Restaurant Chain Now Files A Surprising Bankruptcy.

Don’t forget to opt-in for push notifications so you don’t miss a single article!

Also, thank you to all of our blog sponsors.

This year we’ve been able to increase push notifications slots making it more convenient than ever for new readers to receive their daily market news and updates.

Our readers can now donate $3 per month to support independent journalism.

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