Operations

Rubio's files for Chapter 11 bankruptcy

Provided

October 27, 2020

Rubio's Restaurant Inc., known for its fish tacos, has filed for Chapter 11 bankruptcy and reached a financial restructuring deal with its sponsor, Mill Road Capital, and its lenders — funds managed by Golub Capital — to recapitalize. To implement the deal, Rubio's filed for protection under Chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware.

"Rubio's entered the year in a strong financial position, which has helped the company remain flexible in navigating the unprecedented impact of the pandemic," Marc Simon, president and CEO of Rubio's, said in a company press release. "The agreement with our sponsor and lenders will position the company to thrive in this constantly evolving market. This plan will strengthen our finances and allow us to continue to serve our loyal guests and drive our business forward."

The restructuring contemplates Rubio's obtaining debtor-in-possession financing from Golub Capital and an additional investment from Mill Road Capital. The bankruptcy process provides the company with a consensual reduction of indebtedness, increased access to capital and an opportunity to optimize its operating footprint.

As a result, Rubio's will emerge with enhanced resources to support the ongoing operations of its restaurants in California, Arizona and Nevada, according to the release, which said the restructuring should be complete by the end of the year.

"COVID-19 has had a significant impact on Rubio's, like most businesses, and I'm proud of how we have responded to the challenge," Rubio's co-founder Ralph Rubio said in the release. "Our investments in critical digital technologies in 2019, including online ordering, a mobile app, a new loyalty program and Rubio's delivery, allowed us to pivot swiftly under varying state and county restrictions. We quickly launched family meal kits and shifted to takeout, curbside pickup and free delivery operations, allowing our guests to enjoy our delicious food when and where they want it. This restructuring plan creates the long-term financial stability we need to continue to serve our communities for years to come."

Daily operations at more than 150 Rubio's restaurants in California, Arizona and Nevada will continue with business as usual. The company, however, permanently closed 26 locations — primarily in Colorado and Florida — that had been temporarily closed when the pandemic first hit. In addition, a small number of stores remain temporarily closed and may reopen as state and county restrictions change.

Rubio's first opened in 1983 in the San Diego neighborhood of Mission Bay.