Fast-food chain Krystal files for bankruptcy

One of the nation’s oldest fast-food chains has filed for bankruptcy protection. 

The Krystal Co. has filed for Chapter 11 bankruptcy protection, citing debts of between $50 million and $100 million. The company, which closed about 44 locations during 2019, previously filed for bankruptcy in the 1990s.

“We look forward to emerging from this process as quickly and efficiently as possible with the support of our valued customers, team members, franchisees and suppliers,” stated Krystal president Tim Ward.

Founded in 1932, Krystal operates 82 company-owned restaurants and another 116 franchise locations in Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, South Carolina, Tennessee and Virginia. 

"Shifting consumer tastes and preferences, growth in labor and commodity costs, increased competition, and unfavorable lease terms" were the key reasons for the company's bankruptcy, chief restructuring officer Jonathan Tibus wrote in a court filing.

“The proliferation of fast-casual restaurants, as well as online delivery platforms, has created new competition for traditional quick-service chains,” Tibus stated. “Moreover, quick-service restaurants have faced increasing difficulty finding and retaining qualified employees in the current labor market.”

Based in Dunwoody, Ga., the Krystal Company is owned by Atlanta-based private equity firm Argonne Capital Group.