Despite Bankruptcy, Hooters May Not Go Away Anytime Soon. Here's How The Chain Plans On Sticking Around

After years of struggle in the casual dining sector, another chain has succumb to bankruptcy amidst major financial trouble. On the heels of popular eateries like TGI Fridays, which became officially bankrupt in November 2024, as well as news of Bar Louie's abrupt location closures, Hooters officially filed for Chapter 11 bankruptcy on March 31 2025. Luckily for fans, there is still hope — instead of closing restaurants, it is choosing to restructure by moving from a company-owned business to an all-franchisee model.

It is important to keep in mind that Chapter 11 bankruptcy doesn't mean the end of a business, and it certainly doesn't mean the end of Hooters. Rather, it's a state of financial protection that gives businesses the opportunity to reorganize in order to pay off outstanding debts. The company confirmed via a press release its plans to reorganize and rebuild, rather than shutter away and close up shop. As a part of the Restructuring Support Agreement, Hooters of America, LLC — the parent company for the previously hybrid business model — has plans to sell the business entirely to two franchisee-owned organizations that currently own and operate 30 percent of Hooters locations. Throughout this process, the brand does not expect to close any of its 100 currently operating, company-owned restaurants.

Hooters' announcement that it is entering Chapter 11 bankruptcy protections comes after the chain showed signs of trouble back in 2024. In June, it abruptly closed 40 locations spanning from Kentucky to Florida, all the way to Rhode Island. Initially, the company's reasons for closure cited that those particular restaurants were "underperforming," (via The Independent). During this process, Hooters also showed signs of growth. In that same month that major closures began, the brand also partnered with Publix Super Markets, releasing a line of frozen appetizers, including wings and popcorn chicken. 

Sadly, in February 2025, it surfaced that the controversial chain restaurant very well could be filing for bankruptcy, after news traveled that the company was working with a law firm in preparation. While the most recent development in Hooters' history confirmed that the agreement is finalized, one of the original Hooters founders feels it is for the best. Niel Kiefer (who leads the Hooters Inc organization as CEO), told Bloomberg News that the restructuring was an opportunity for the wing chain to shed its "private equity overlords" and become more family-friendly, as it used to be.