A major burger chain is making another big change as it works to recover from financial struggles. The move comes shortly after the company sold more than 100 of its restaurants to franchise operators.
Red Robin secures new financing
Red Robin Gourmet Burgers has secured a new $115 million financing agreement, giving the chain additional money to work with as it continues its turnaround.
The new agreement includes a $25 million line of credit and a $90 million loan. It replaces the company’s previous financing arrangement and runs through October 2031.
The announcement comes shortly after Red Robin made major changes to its restaurant portfolio, including selling locations it previously operated itself.
More than 100 restaurants sold
Red Robin recently completed deals to sell 108 restaurants for about $89.4 million.
The restaurants were sold to franchise operators in three separate transactions. Red Robin also expects to sell another eight restaurants by the end of its 2026 fiscal year, potentially bringing the total to 116 locations and roughly $96 million in proceeds.
The company said much of the money from the restaurant sales will be used to pay down debt.
Chain works to turn business around
The moves are part of Red Robin’s broader effort to improve its business after years of challenges facing the casual-dining industry.
The chain has been working to increase sales, attract more customers, reduce debt, and rely more heavily on franchise operators.
There have been some positive signs. Red Robin reported that comparable restaurant revenue increased 1.3% during its second quarter, while guest traffic declined just 0.2%, marking the chain’s best quarterly traffic performance since the first quarter of 2023.
The latest move gives Red Robin more time and money to continue its turnaround as the burger chain works to stabilize its business.
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