The Krystal Company has filed for Chapter 11 bankruptcy protection, but said today it plans to keep its restaurants open.
The Dunwoody-based restaurant chain cited debt of between $50 million and $100 million in its petition, which was filed in federal bankruptcy court in Atlanta on Sunday (Jan. 19).
Krystal owes food suppliers, and marketing and equipment companies among others.
Officials said the fast-food chain, known for its small, square burgers with steamed buns and chopped onions, is seeking to restructure quickly and build a better brand. The company touts itself as the South’s oldest restaurant chain.
“The actions we are taking are intended to enable Krystal to establish a stronger business for the future and to achieve a restructuring in a fast and efficient manner,” the company said in a statement. “We are pleased to be ready to move toward a brighter future for the brand and have the support of our stakeholders.”
The chain cited shifting consumer tastes, higher operating costs and the growth of online food ordering to the company’s financial problems, according to court documents.
Krystal has about 300 restaurants in 10 states: Georgia, Alabama, Arkansas, Florida, Kentucky, Louisiana, Mississippi, North Carolina, South Carolina and Tennessee. There are about 75 locations in metro Atlanta. The company has launched initiatives to refranchise between 100 and 150 of its company-owned restaurants.
The Krystal Company, owned by Atlanta-based equity firm Argonne Capital Group, was founded in Chattanooga, Tenn. in 1932.