Even before FAT Brands filed for Chapter 11 bankruptcy, it had made some clear choices about which brands in its large portfolio it intended to support.
The chain clearly backed its Twin Peaks sports bar concept over its Smokey Bones barbecue chain.
“Twin Hospitality has prioritized optimizing Smokey Bones’ footprint, identifying 19 restaurants for conversion into better-performing Twin Peaks lodges,” the company shared in a press release.
That decision was made before the company’s Chapter 11 bankruptcy filing in January.
At the time, the company defended the change based on financial performance.
“Two of these conversions have already been completed and generate significantly higher average unit volumes (AUVs) of approximately $7.8 million, compared to approximately $3.5 million as Smokey Bones,” it shared.
FAT Brands also said that it will close 15 underperforming Smokey Bones locations by the end of the first quarter in 2026.
Now all remaining Smokey Bones locations have closed, according to reports from ABC News and NBC, in a move that was not publicly announced in advance.
Smokey Bones has closed its doors
A visit to the Smokey Bones website shows all its remaining locations as “closed today.”
The company did not immediately answer a request for comment made through its “Contact Us” web page.
It also has not responded to local media requests.
“Twin Hospitality did not immediately respond to an NBC4 request for comment on if the Columbus-area locations would become Twin Peaks restaurants,” the news site reported.
FAT Brands has struggled with debt
Former FAT Brands CEO Andy Wiederhorn, who stepped down in March, made it clear on Jan. 12 at the ICR conference in Orlando that debt led to the company’s Chapter 11 filing.
“We’ve been talking about restructuring this debt for 18 months to two years with our note holders,” Wiederhorn said, according to Nation’s Restaurant News. “It has not been a very constructive negotiation…. We’re looking at avenues to lower the debt and make it practical. I wish I could say that this would go quickly and get resolved, but it may take a couple of rounds.”
Wiederhorn stepped aside from his position because he intends to bid on FAT Brands assets. He has agreed to take a temporary leave of absence from the company through the remainder of its bankruptcy process, according to court documents filed on March 19.
The change was negotiated by the court, Wiederhorn, and the company’s restructuring executives.
“Through the Mediator’s substantial efforts and contributions, and the good-faith negotiation of all parties, the Mediation has proved fruitful, culminating in: an agreement providing for a transition of full governance to the Special Committees and a new Chief Executive Officer,” the documents read.
Debt forced FAT Brands into Chapter 11
Priot to it Chapter 11 filing, FAT Brands warned that a problem with its key lenders could result in a bankruptcy. The company shared the details of its financial problems in a 10-K filing with the SEC.
In practical terms, the filing said that UMB delivered to Fat Brands a “Notice of Event of Default” with respect to the FB Resid Indenture, stating that an “Event of Default had occurred pursuant to Section 9.2 of the FB Resid Indenture. The aggregate principal amount outstanding under the FB Resid Notes is $158.9 million, or $110 million net of FB Resid Note,” it shared.
FAT Brands did not have that much cash on hand, which made a Chapter 11 bankruptcy a real risk, the company warned.
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Smokey Bones has faced higher costs
Some industry analysts have speculated that FAT Brands/Twin Hospitality could be looking to exit the barbecue business entirely, partially because of its menu.
“Though profitable, considering the menu is highly focused on entrees such as steak and brisket, which have faced steep price increases, this year could be the end of Smokey Bones,” Restaurant Dive reported.
Local experts think the chain just no longer stands out, given how many local barbecue choices are available.
“I think it’s just reflective of the fact that there’s just a lot more options than in years past in the Valley,” Marc Nelson, director of economic development for the City of Roanoke, told WSLS. “And [Smokey Bones] was one of the restaurants that just wasn’t frequented as much.”
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