Indianapolis-based Steak ‘n Shake Inc. is looking for guidance as the deadline for a $153 million loan looms. The Wall Street Journal reports the restaurant chain has hired Washington D.C.-based advisory firm FTI Consulting Inc. (NYSE: FCN) to help the company through a possible financial restructuring.
Payment on Steak ‘n Shake’s loan is due on March 19. In its third quarter earnings report in November, the chain’s Texas-based parent, Biglari Holdings Inc. (NYSE: BH), said it may not be able to refinance the loan ahead of the March deadline.
Steak ‘n Shake, like many restaurants, has seen its struggles during the pandemic. In the first quarter of 2020 alone, the company closed nearly 60 locations.
In the third quarter report, Biglari reported $78 million in revenue for Steak ‘n Shake, down from $141 million in the same period the previous year. However, the restaurant reported a net loss of $63 million, compared to $861 million in the third quarter of 2019.
Sources tell The Wall Street Journal the company is exploring a potential out-of-court debt restructuring avenue, or possibly filing for bankruptcy. Biglari says it is looking to transform Steak ‘n Shake’s full-service model into a self-service one after reopening its dining rooms, which have been closed due to the pandemic.
You can read the full story from The Wall Street Journal by clicking here.