Wednesday, July 30, 2008

Is Bennigan's the Economic Canary in the Coal Mine?

The Dallas Morning News reported on the abrupt closing of company owned Bennigan's and Steak & Ale restaurants. The article stated:

S&A Restaurant Corp., a subsidiary of Plano-based Metromedia Restaurant Group, has filed for Chapter 7 bankruptcy protection, the company said in an e-mail Tuesday. S&A operated the Steak & Ale, Bennigan's and The Tavern restaurants.

A Chapter 7 filing means all assets are to be sold off to pay creditors and the company will close – a move that shocked even insiders aware of the parent company's financial woes.

"I was blindsided by the Chapter 7," said Larry Briski, president of the Bennigan's Franchise Operators Association

Might the closing of these company owned restaurant chains be the economic canary in the American coal mine? More information could shed light on this question, but as usual, they aren't talking.

Metromedia did not provide details on what drove it to pull the plug on its brands.

Hot an saucy has a brand new meaning.