Burger King franchisee Meridian Restaurants Unlimited sold a majority of its restaurants out of bankruptcy months after filing for court proceedings due to COVID pressures, QRS Magazine reported. The company had 120 restaurants when it entered bankruptcy in March. At the time of the auction — which occurred this month — it had 91 stores. Seventy of them were sold to Burger King and four franchisees for a little over $17 million combined. According to court documents, there were no acceptable qualified bids for the remaining 21 restaurants. Meridian blamed its bankruptcy on cash-flow issues stemming from increased wages, labor costs, shipping, food inflation, decreased availability of staff, and declining food traffic. The company was suffering from lower revenues, without proportionate decreases in rent, debt service, and other liabilities. This has been the story since Meridian started; the franchisee has lower revenues than the system average because the founder acquired underperforming stores. The chain had $14 million in unsecured debt when it filed. It owed Burger King royalties, advertising contributions, rent, and other amounts. There were also funds due to other landlords.
