Luby’s, the Texas cafeteria style dining restaurant, spent years trying to rebuild in a crowded marketplace, announcing that the company was up for sale in June 2020. As of September, the 70-plus year old company has announced that no buyer has been found and they will begin liquidating assets and dissolving. The coronavirus pandemic has flipped many retailers and restaurants on their backs as the unexpected crisis has caused closures and furloughs. The pandemic has been exceptionally unkind to the restaurant industry, where a forecast shows that 30% may be at risk of a permanent closure. The threat can be even greater for retailers and restaurants that struggled longer before coronavirus public safety restrictions were put in place, slashing building capacities.
Bob Luby opened his first Luby’s restaurant in 1947 in San Antonio with the goal to serve good, fresh food in a setting people would want to return to. The restaurant has been a staple of Texas family dining for decades, and the dissolution marks a major loss for cafeteria and buffet-style dining.
Luby’s Inc. is the parent company of Luby’s restaurants and the Fuddrucker’s burger chain which have both been struggling since the start of the pandemic. Luby’s announced it will go forward with the plan of liquidation and dissolution which would trigger the sale of all assets to company stockholders after payment of debt and other obligations. In a statement, Luby’s announced they are liquidating all its assets from 147 restaurants and will use the cash to pay its stockholders. According to CNN, Luby’s Inc. estimates between $92 million and $123 million in distributions to stockholders.
"We believe that moving forward with a plan of liquidation will maximize value for our stockholders, while also preserving the flexibility to pursue a sale of the company should a compelling offer that delivers superior value be made," Christopher Pappas, president and CEO of Luby's, said in the release. "The plan also continues to provide for the potential to place the restaurant operations with well-capitalized owners moving forward."
While long term patrons of the restaurant believe this to be the impending end, in a series of tweets, Luby’s assured they still have 80 restaurants open and serving food and they plan to be here for the holidays and beyond.
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