Bloomin’ Brands has entered an agreement to purchase the assets of Out West Restaurant Group, a major Outback Steakhouse franchisee that filed for Chapter 11 bankruptcy protection in Delaware. The deal positions the parent company as the “stalking-horse” bidder, establishing an initial offer that other potential buyers can attempt to exceed through a court-supervised sale process.
Out West Restaurant Group, which is affiliated with Cerca Trova Restaurant Group, operates 61 Outback Steakhouse locations across California, Arizona, Nevada, Colorado, and New Mexico. According to an SEC filing, the proposed acquisition price is approximately $26.3 million, subject to adjustments and the assumption of specific liabilities. If the transaction closes, Bloomin’ Brands would gain direct control of these franchisee-operated restaurants.
Out West Restaurant Group faces financial distress and bankruptcy filing
The San Diego-based operator filed its voluntary Chapter 11 petition in the U.S. Bankruptcy Court for the District of Delaware, according to reports. While the specific cause of the bankruptcy was not detailed in the filing, Out West reported assets and liabilities valued between $10 million and $50 million. The company identified Performance Food Group as its largest unsecured creditor, with a claim exceeding $4 million.
Financial instability for the franchisee appears to have been building for some time. Yahoo Finance reported that in December 2023, Bloomin’ Brands, the franchisee, and its lenders reached an agreement to delay payments and forestall the enforcement of rights related to previous defaults. Under that prior arrangement, a bankruptcy filing would have triggered immediate repayment of sums owed to Bloomin’ and lenders. However, the current filing has placed those specific provisions on hold, leaving the rights of the parties to be determined by the court.
Bloomin’ Brands provides financing to maintain restaurant operations
To ensure stability during the legal proceedings, Bloomin’ Brands has agreed to provide up to $5.5 million in interest-free debtor-in-possession financing. This funding is intended to support Out West’s daily operations and cover professional and administrative costs associated with the Chapter 11 case. According to Yahoo Finance, this access is contingent upon court approval and is only permitted when operating cash falls below a minimum required level.
The parent company stated that the bankruptcy filing will have no immediate impact on restaurant employees, customers, or daily operations. Out West intends to continue operating its locations throughout the process and has requested court permission to pay obligations incurred before the petition, including amounts owed to vendors, suppliers, and employees. The company also plans to continue paying rent on leases and franchise fees or royalties to Bloomin’ Brands.
$BLMN Bankruptcy Filing: On November 2, 2026, Cerca Trova Restaurant Group Holdings, Inc. filed for Chapter 11 bankruptcy affecting its 61 Outback Steakhouse locations, while Bloomin' Brands planned to acquire its assets for $26.3 million. The company has agreed to provide $5.5…
Timeline for the asset sale and court approval
The acquisition remains subject to several conditions, including approval from the bankruptcy court. While Bloomin’ Brands has set an initial bid, the sale process may include an auction if qualified competing bids are submitted. WhatNow reports that the expected closing deadline for the agreement is January 31, 2027.
The proposed deal includes the assumption of certain obligations, such as future lease payments, specified vendor liabilities, and the handling of unused gift cards. Bloomin’ Brands indicated that securing these restaurants would allow for direct operational insight and the ability to implement investments through its existing development initiatives.
Out West Restaurant Group Bankruptcy Details
| Detail | Information |
|---|---|
| Number of Locations | 61 Outback Steakhouse units |
| Primary States | CA, AZ, NV, CO, NM |
| Stalking-Horse Bid | $26.3 million |
| Emergency Financing | Up to $5.5 million (interest-free) |
Outback Steakhouse locations remain open during Chapter 11 proceedings
Will the Outback Steakhouse locations close during the bankruptcy?
No. According to Bloomin’ Brands and SEC filings, Out West intends to continue operating all 61 restaurants throughout the Chapter 11 proceedings.
What happens if another company wants to buy the restaurants?
Because Bloomin’ Brands is acting as the “stalking-horse” bidder, they have set the floor price. Other interested buyers can participate in a court-supervised auction to submit higher or better proposals.
Who is the largest creditor involved in the filing?
Nation’s Restaurant News reports that Performance Food Group is the largest unsecured creditor, with a claim of more than $4 million.
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