The operator of the Joe’s Crab Shack and Brick House Tavern restaurant chains said that it is preparing to file for bankruptcy, Bloomberg reported yesterday. Ignite Restaurant Group Inc. could file as soon as next week. In early April, the company announced it was pursuing options including a possible sale with financial advisor Piper Jaffray Cos. Both strategic and private equity buyers are considering purchasing the company out of bankruptcy. The dining sector has been facing drops in customer traffic, and Ignite reported declining sales in the most recent quarter, with comparable-restaurant revenue falling by 6.8 percent. The company’s debt totals about $121 million, including $112 million on a term loan set to mature in 2019, according to data compiled by Bloomberg. Joe’s Crab Shack was founded in 1991 as a national chain of seafood restaurants. As of January, Houston-based Ignite operated 112 Crab Shacks and 25 Brick House Taverns. It sold its 150-location Romano’s Macaroni Grill chain to Redrock Partners LLC in 2015.
