A bankruptcy auction for the fast-casual Roti chain is scheduled for next month.
The Chicago-based Mediterranean chain that operates under Roti Restaurants LLC filed for Chapter 11 bankruptcy in August and is in the process of selling all 19 of its store locations, intellectual property, operational know-how, equipment and other assets, according to Ravinia Capital LLC, which posted the bankruptcy sale last week. The assets will be sold free and clear of liabilities.
An auction is scheduled for Nov. 11, with a minimum bid of $3.5 million required, though lower bids will be considered for qualified buyers who might be interested in particular markets or individual locations. Roti operates in Chicago, Minneapolis and the Washington, D.C. area.
The deadline for bids is Nov. 7.
The company said it generated revenue of $25.7 million in 2023 with the 19 units, and store-level earnings were $2.9 million—a level that was expected to continue into this year, on an adjusted basis.
But Roti was challenged by pandemic rent deferrals and other lease obligations, and the chain lacked the capital and scale to persevere, despite the fact that nearly all of its locations were cash-flow positive, the company said.
The chain has been shrinking since the pandemic, particularly in urban areas where workers were slow to return. In 2021, Roti closed one third of its restaurants, and another four closed last year.
CEO Justin Seamonds in a statement said he hoped the bankruptcy would help find a purchaser for the chain or financial support for restructuring in order to ensure its long-term viability.
Roti is one of a number of chains that hope to emerge from bankruptcy with new ownership, including Red Lobster and Rubio’s. The bankruptcy sale of the parent company of Tender Greens and Tocaya is expected this week, and BurgerFi International Inc. is also seeking a buyer for the namesake burger chain, as well as Anthony’s Coal Fired Pizza.
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