Overview
- Meritage Hospitality Group filed for Chapter 11 in the U.S. Bankruptcy Court for the Western District of Michigan on Thursday and said it will continue operating while it restructures.
- The company runs 314 Wendy’s restaurants across 15 states and said it expects to keep paying about 9,000 team members their wages and benefits during the bankruptcy process.
- Meritage pointed to sustained systemwide pressure on the Wendy’s brand as the main cause, citing falling store-level profits after beef cost increases, heavy discounting, and weaker marketing.
- Meritage estimated assets and liabilities in the $10 million to $50 million range and listed Wendy’s franchise business, Quality Is Our Recipe LLC, as a top unsecured creditor with a reported $24.9 million claim for deferred fees.
- The filing is the latest sign of strain for Wendy’s, which has reported multi-quarter same-store sales declines and prompted prior store closures and a company turnaround plan that aims to stabilize franchise economics.