Luby’s said its board has approved a plan to liquidate the company through the sale of its real estate and other assets, which include the Luby’s Cafeterias and Fuddruckers brands.
The company said it expects the sell-off to generate $93 million to $128 million. After the proceeds are distributed to shareholders, the company will be dissolved.
The plan is still subject to the approval of shareholders. Before and afterward, Luby’s would be open to a sale of the company or its distinct businesses, which also include a foodservice management operation called Culinary Contract Services.
Luby’s had announced on June 3 that it was seeking buyers for all or portions of its operations. That effort apparently failed to bring acceptable offers.
“This plan of liquidation is the next logical step in the company’s previously announced plan to maximize the value of the company through the sale of its operations and assets,” Luby’s board said in a statement. “
CEO Chris Pappas added that the plan provides “the flexibility to the company should a compelling offer that delivers superior value be made.” He left open the possibility that the company’s restaurant operations will be maintained under well-capitalized buyers.
Luby’s was founded in 1947 in San Antonio, Texas by Bob Luby. Its namesake brand, a string of cafeterias, were its core business until it started diversifying into other brands about a decade ago. It secured the rights to the Fuddruckers, Koo Koo Roo and Cheeseburger in Paradise chains while launching Culinary Contract Services to manage so-called noncommercial foodservice facilities.
The company has been struggling for years to stem a slide in sales and traffic. The challenge was accentuated by the pandemic.
It has since sold off most of the restaurants in those chains. Today the company operates about 77 namesake cafeterias and about 50 Fuddruckers units, and franchises about 100 more Fuddruckers.