By Bloomberg News and IBJ Staff
Italian restaurant chain Buca di Beppo filed for Chapter 11 bankruptcy on Monday, days after closing 13 underperforming eateries nationally, including one of its three local locations.
The Buca di Beppo at 6045 E. 86th St. near Castleton Square Mall was among the restaurants that closed in 11 states, according to court papers.
Buca continues to operate 44 restaurants in 14 states, including its downtown Indianapolis restaurant at 35 N. Illinois St., and its restaurant at 659 U.S. 31 N. in Greenwood
The Castleton location opened in 1999, one year after Buca entered the Indianapolis market with its downtown eatery.
The Orlando, Florida-based chain said it plans to reorganize by canceling leases on the locations the company has closed.
The company blamed its troubles on lower sales, rising costs and the difficulty of hiring, according to court papers filed Monday in U.S. Bankruptcy Court in Dallas. Buca said it owed creditors as much as $50 million in its Chapter 11 petition.
The same problems were cited by several dining chains that sought bankruptcy protection this year, including Red Lobster and casual Mexican restaurant chain Tijuana Flats.
Buca is scheduled to be in court on Wednesday, seeking approval to keep paying wages and other ordinary business costs while it reorganizes. The restaurant chain said it has more than 3,000 part-time employees and 266 full-time employees.
The company has also asked permission to cancel contracts it says it can no longer afford. Restaurant chains typically use bankruptcy to get rid of unprofitable leases as they slim down their footprints.
Buca was founded in 1993 in Minneapolis and grew to more than 100 locations at its peak. The company went public in 1999 when it hit 20 locations, but delisted after its CEO and two other top executives were charged with fraud in 2006.
The company was acquired by Planet Hollywood International Inc. for $28.5 million in 2008.
