Will Steak ‘n Shake declare bankruptcy?
Struggling Steak ‘n Shake could declare bankruptcy as soon as this week, according to a report in Bloomberg. The 1934-founded burger chain is considering filing for Chapter 11 to address upcoming debt maturities as it continues to grapple with COVID-19 downturns.
How much does it cost to open a Steak ‘n Shake franchise?
Selected franchisees (who we refer to as Franchise Partners) are given the rights necessary to run a franchised Steak ‘n Shake restaurant for a total investment of $10,000. This opportunity necessitates that the applicant have no other ongoing business activities and run the restaurant themselves full-time.
What happened to steak and shake Biglari?
Biglari Holdings paid off the company’s debt, keeping it from bankruptcy, and now the chain looks to self-serve kiosks for its future. By Jonathan Maze on Feb. 28, 2021 Biglari Holdings kept Steak ‘n Shake out of bankruptcy—and in its possession—with a last-minute payoff of its debt.
What went wrong at Steak ‘n Shake?
Central to Steak ‘n Shake’s concern was a $153 million loan coming due in March, which parent company Biglari Holdings would not guarantee maturing in a November filing. It admitted it would struggle to pay off or refinance the debt.
See more
How did Steak and Shake acquire the loans?
Steak ‘n Shake argues that Fortress acquired the loans through subsidiaries that had names different from the investment fund, such as a joint venture called BJC Ventures. The burger chain argues that Fortress bought up a majority of the loans through four separate investment funds. It also argues that Fortress bought the debt at rates higher than market prices, saying that Fortress was able to do so because it had information other investors did not.
How much did Steak and Shake pay for Fortress?
According to legal filings, Steak ‘n Shake paid $102 million to repurchase the loans held by Fortress and other lenders. The company has not provided a comment on the lawsuit or the repayment.
What did Steak and Shake say about the Fortress?
Steak ‘n Shake said that Fortress entered into a confidentiality agreement to get information on the real estate put up for sale. The two sides discussed the sale of the real estate over the course of the summer, according to the complaint. But Steak ‘n Shake argues that Fortress repeatedly changed terms of the offer, which ultimately scuttled the process.
Is Steak and Shake a hybrid chain?
In its complaint, filed in an Indiana state court on Friday, Steak ‘n Shake said that Fortress had expressed interest in acquiring some of Steak ‘n Shake’s real estate portfolio, which it had put up for sale last year to raise funds to pay for the chain’s shift to a counter-service model—Steak ‘n Shake has historically been a full-service chain with a drive-thru, making it a hybrid chain.
Does Steak and Shake have a debt guarantee?
Parent company Biglari Holdings does not guarantee the debt on Steak ‘n Shake.
Is Steak and Shake going bankrupt?
Steak ‘n Shake, which has been struggling with weak sales and traffic in recent years, was believed to be nearing bankruptcy and was expected to seek out debt protection last week, in advance of a March due date of its loan. As of September, the company had $153 million due on that loan.
How much did Fortress buy Steak and Shake?
Fortress ultimately purchased $89 million, or more than half, of Steak ‘n Shake’s outstanding debt. The lawsuit alleges Fortress “said it would either force the Company to repay the Loans in full or file for bankruptcy, in which case Fortress intended to ‘take the keys’ to the business.”.
Can Steak and Shake refinance?
In November, Texas-based Biglari Holdings (NYSE: BH), the parent of Steak ‘ n Shake, said it may not be able to refinance the loan before the March deadline. The company hired advisors, including Washington D.C.-based FTI Consulting Inc. to help with its financial struggles.
Is Steak and Shake going bankrupt?
INDIANAPOLIS (Inside INdiana Business) — Indianapolis-based Steak ‘n Shake Inc. has avoided the possibility of filing for bankruptcy. Sources tell Bloomberg the restaurant chain has purchased and retired the balance of its $220 million loan, which was due in March, however it has also filed a lawsuit against an investment firm it says tried to force the company into bankruptcy.
How much does it cost to franchise a steak and shake restaurant?
For a total investment of $10,000 selected franchisees (who we call Franchise Partners) are granted the rights necessary to operate a franchised Steak ‘n Shake restaurant. This opportunity requires that the individual be free of any other active business ventures and operate the restaurant on a full-time hands-on basis.
Why do we collect information from steak and shake?
Your information is being collected so that we may contact you regarding your interest in a Steak ‘n Shake restaurant franchise opportunity. We do not share your information with any outside parties unless you specifically authorize us to do so.
What is steak and shake?
At Steak 'n Shake we believe in equal opportunity for all to achieve the American dream. Often, however, those with ability don’t have access to the necessary capital needed to realize that dream. We are challenging and changing that reality. We are providing the opportunity for you to become a business owner without having to make a significant financial investment. Learn more about how to become a Franchise Partner of an existing company owned Steak 'n Shake location in your area.
How did Steak and Shake raise funds?
Most of the expense was expected to go toward equipment, and Steak ‘n Shake planned to raise funds by selling owned real estate via auction. It put 15 venues up for sale in August. This stirred issue as well. Lenders argued proceeds from the sale must pay down debt and not be reinvested.
Is Steak and Shake going bankrupt?
Struggling Steak ‘n Shake could declare bankruptcy as soon as this week, according to a report in Bloomberg. The 1934-founded burger chain is considering filing for Chapter 11 to address upcoming debt maturities as it continues to grapple with COVID-19 downturns.
How much does Biglari pay to remodel?
Biglari said the company would pay $100,000 to $200,000 to remodel the interior of each company-owned or franchise partner restaurant, adding a new point-of-sale system along with the self-order kiosks.
Why is Steak and Shake having problems?
Steak ‘n Shake was facing problems because sales had stumbled in recent years. The chain has reported an operating loss in each of the past three years, including $4.6 million in 2020. Its unit count has also declined by 70 over the past two years to 556, according to Biglari’s letter.
Is Steak and Shake going bankrupt?
But Steak ‘n Shake first had to avoid bankruptcy. The company spent much of 2020 with the looming threat of a bankruptcy filing amid its own financial concerns as well as a looming deadline to pay off its $153 million in debt. It avoided that at the last minute last week.
Is Steak and Shake a fast food restaurant?
Steak ‘n Shake has long been a hybrid family dining-quick service chain. It operated a family dining restaurant centered on its steakburgers, but featured drive-thru windows that fueled its takeout business.
Did Fortress Investment Group buy Steak and Shake?
But Fortress Investment Group bought up Steak ‘n Shake’s debt on the secondary market and then tried forcing it into bankruptcy—which would have enabled the company to take over the brand. Steak ‘n Shake, Biglari noted, is an important holding.
Is Biglari going bankrupt?
Biglari Holdings paid off the company’s debt, keeping it from bankruptcy, and now the chain looks to self-serve kiosks for its future. By Jonathan Maze on Feb. 28, 2021
Did Biglari pay off debt?
It avoided that at the last minute last week. Biglari in his letter acknowledged that the parent company opted to pay the debt off, using cash and investments.
Section I – Steak ‘N Shake Franchise Costs
- Steak ‘n Shake franchise costs (freestanding quick service format), based on Item 7 of the company’s 2022 FDD:
Section III – Number of Franchised and Company-Owned Steak ‘N Shake Outlets
- Franchise Partner
2019 1. Outlets at the Start of the Year: 1 2. Outlets at the End of the Year: 29 3. Net Change: +28 2020 1. Outlets at the Start of the Year: 29 2. Outlets at the End of the Year: 86 3. Net Change: +57 2021 1. Outlets at the Start of the Year: 86 2. Outlets at the End of the Year: 159 3. Net Change: +… - Company-Owned
2019 1. Outlets at the Start of the Year: 410 2. Outlets at the End of the Year: 365 3. Net Change: -45 2020 1. Outlets at the Start of the Year: 365 2. Outlets at the End of the Year: 272 3. Net Change: -93 2021 1. Outlets at the Start of the Year: 272 2. Outlets at the End of the Year: 195 3. …
Section IV – Background Information on The Steak ‘N Shake Franchise
- 15 Things You Need to Know About the Steak ‘n Shake Franchise
Avoids Bankruptcy and Refocuses on Growth 1. In early 2021, Steak ‘n Shake announced that it might have to file for bankruptcy. After some maneuvering, Steak ‘n Shake was able to avoid bankruptcy and in March the company announced that it had plans to open 12 new restaurants …
Section V – Financial Performance Representations
- The historical financial performance representations in this section include unaudited results for the 12-month period ended December 29, 2021 (“FY21”) for 81 traditional franchise restaurants and...