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By James Bickerton
News Reporter
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Red Lobster has yet to issue a public statement explaining why at least 48 of the company's restaurants were abruptly closed to the public in Monday amid reports of financial difficulties.
According to the official Red Lobster website the company operates from around 650 locations across the U.S., some of which have now been marked as "temporarily closed."
During the third quarter of 2023, Red Lobster lost $11 million according to Restaurant Business, with the restaurant chain taking a big hit earlier this year when parent company Thai Union Group announced it was divesting, prompting bankruptcy fears.
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The official Red Lobster account on X, formerly Twitter, hasn't been updated since April 15 while the last post on its Facebook page, which has 4.6 million likes, was on Sunday. No recent posts on either platform made reference to Red Lobster planning to shut restaurants in the coming days. Newsweek contacted the Red Lobster press office for comment by email.
On Facebook, Rickey Williams Jr., the mayor of Danville, Illinois, said that his city's branch of Red Lobster had suddenly laid off its entire staff.
He said: "I was just notified by one of our local Red Lobster managers that after 31 years of serving our community, without notice, their parent company laid off the entire crew and closed the restaurant effective immediately.
"This is despite the fact that they were rated number 15 out of over 600 stores for customer service & satisfaction last year. They also shuttered nearly 120 other stores without notice.
The mayor added: "To our local Red Lobster family, THANK YOU for serving us so well & being the place we all went to for special occasions. Our prayers are with you and we're here to help in any way we can."
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According to MacroEdge, a company focused on economic intelligence, around 6,500 Red Lobster employees have been impacted by the store closures, though this figure has not been officially confirmed.
Restaurant liquidator TAGeX Brands began auctioning kitchen equipment, furniture and other items from more than 50 Red Lobster locations on Monday.
In a post on X the company said: "Select Red Lobster locations CLOSED today! Prepare for the LARGEST restaurant liquidation EVER! Fixtures, furniture, and equipment MUST GO. Auctions start NOW. SINGLE winner for each location. WINNER TAKES ALL."
Before divesting from Red Lobster Thai Union Group attributed the company's decision to make its "Ultimate Endless Shrimp" a permanent offer as a "key factor" in its ongoing financial difficulties.
According to Restaurant Business in November Union Group's CFO Ludovic Regis Henri Garnier, speaking to investors, said: "We knew the price was cheap, but the idea was to bring more traffic to the restaurants. So we wanted to boost our traffic, and it didn't work."
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