Red Lobster has received court approval for its Chapter 11 exit plan, nudging the popular casual-dining seafood chain closer to emerging from bankruptcy.

Known for its seafood offerings and iconic cheddar biscuits, the company filed for bankruptcy protection in May after facing a series of challenges, including growing competition, expensive leases, and—some will have you believe—a failed shrimp promotion that compounded existing financial difficulties.

Additionally, the broader pullback in consumer spending, especially in the wake of the pandemic, further strained the company’s finances.

Here’s what will be different about the restaurant chain once it emerges from bankruptcy:

• New owners: Under the approved restructuring plan, RL Investor Holdings, a group of investors that includes TCW Private Credit, Blue Torch, and funds managed by affiliates of Fortress Investment Group, will acquire the chain by the end of the month.
• Fewer locations: Red Lobster will continue to operate independently, albeit with 544 restaurants across the United States and Canada, slimmed down from 578 locations pre-bankruptcy filing. The company has announced numerous closures in court filings since the bankruptcy.
• New boss: Once the acquisition is finalized, former P.F. Chang’s CEO Damola Adamolekun will step in to lead Red Lobster as chief executive, replacing Jonathan Tibus, who guided the company through its bankruptcy process.

Adamolekun expressed enthusiasm for the future, stating that the new ownership group is committed to reinvigorating the brand with over $60 million in new funding. He emphasized that the investment will help Red Lobster modernize while retaining the key elements that have made it a beloved name in the industry.

“Red Lobster’s future is brighter now than ever before. I cannot wait to get started on our investment plan, and to get out and meet diners across the USA and Canada,” Adamolekun said in a media release announcing the decision.

This development comes at a challenging time for the restaurant industry, with several other chains filing for bankruptcy this year, struggling with high interest rates and post-pandemic shifts in consumer spending.