Red Lobster, the famous seafood chain known for its endless shrimp, has fallen like an anchor to the bottom of the sea — and its only way out is Chapter 11 bankruptcy. After closing several locations and laying off hundreds in recent weeks, the company hopes Sunday’s filing will help the casual dining staple get back on track.

• The trouble started in 2014 when Darden Restaurants ($DRI) sold Red Lobster to private equity investors — which acquired the company’s land and raised the rent to levels “above market rates,” putting a strain on the company.
• Things got worse when the number of customers dropped 30% since 2019 — especially with the costly “all-you-can-eat shrimp” promotion.

What happens now? Red Lobster is owned by its lenders, including Fortress Investment Group, who are owed a healthy portion of the company’s $1B to $10B in liabilities. Fortress is lending the company $100M to keep it afloat during the bankruptcy process. The restaurant plans to sell billions in assets to pay back its debts — and the hope is that with less debt and a well-known brand, Red Lobster can find new life.