Five Outback Franchise Operators Seek Bankruptcy Protection and Propose Asset Sale

Key Facts

Five companies linked to Cerca Trova filed for bankruptcy protection and asked to sell most of their assets under procedures that still require court approval. The companies include Cerca Trova Restaurant Group Holdings and four subsidiaries, among them Cerca Trova Southwest Restaurant Group and Out West Restaurant Group. Cerca Trova Southwest operates Outback franchises in the western U.S., while Outback Steakhouse remains a brand owned by Bloomin’ Brands. The filings therefore concern operating and franchise companies affiliated with Cerca Trova, and do not mean that Bloomin’ Brands or the brand itself filed for bankruptcy. The proposed sale is also not a completed transaction; it includes procedures for soliciting bids and an agreement with a backup buyer, according to the case docket.

Case data published on November 2 paint a stark picture of the main debtor’s financial position: estimated assets of $0 to $100,000, against liabilities ranging from $100 million to $500 million. These estimates apply to the main debtor as reported in the case data and do not describe Bloomin’ Brands’ balance sheet or the total value of the Outback group. The request to sell most assets is part of a court process that requires approval, and the available information does not establish that the sale has been completed or its terms finalized. The backup-buyer agreement is part of the bidding procedures, but does not eliminate the need for court approval. The documents show that the companies also moved in parallel to seek operating arrangements while the case is pending.

In first-day motions filed on November 2, the companies sought to keep operations running while the court considers the filings. The motions addressed facilities, sales and use taxes, employee wages, bank accounts, essential vendors and customer programs. They included docket numbers 7, 8, 10, 11, 12 and 13, according to Bankruptcy Observer, citing the court record. These are procedural requests, not evidence that the court has already approved them. The companies also sought arrangements related to debtor-in-possession financing during the bankruptcy proceedings, according to the topics in the case filing, but the available information does not resolve the outcome of the financing request. Continued operations remain subject to the motions before the court.

The bankruptcy was preceded by tension in Out West’s credit relationship with Bloomin’ Brands. In a filing with the U.S. Securities and Exchange Commission, Bloomin’ Brands said it had received notice that Out West was no longer in compliance with one or more covenants in its credit and forbearance agreements. The company said it was working with Out West and other parties to address short-term liquidity constraints and long-term operations, and that it could not predict the outcome. It also said Out West continued to operate its restaurants in the ordinary course and was current on its obligations to Bloomin’ Brands through June 28, 2026. The filing does not specify that the covenant breach or liquidity constraints caused the current bankruptcy filings.

Out West operates about 71 Outback Steakhouse franchise restaurants in the western United States, according to Bloomin’ Brands’ disclosure about its position through June 28, 2026. But the parent company’s published quarterly sales figures cover its company-owned Outback restaurants in the U.S., not the Out West network alone. Sales at those restaurants were $576.278 million in the 13 weeks ended June 28, 2026, compared with $571.897 million in the 13 weeks ended June 29, 2025. The figure provides context on the brand’s performance at its owner, but does not by itself measure the debtors’ sales or financial condition. The comparison shows reported sales rose between the periods, while customer traffic at U.S. Outback restaurants remained under pressure.

In the 13 weeks ended June 28, 2026, Outback customer traffic fell 2.8% year over year, compared with a 1.0% decline in the corresponding period ended June 29, 2025. At the end of June 2026, the total number of Outback restaurants in the U.S., both company-owned and franchised, was 659, compared with 678 at the end of June 2025. Bloomin’ Brands’ chief executive, meanwhile, said continued progress on Outback’s turnaround plan led the company to raise its annual earnings outlook. These figures provide operating context for the brand and its parent company, but do not establish the performance of the five franchise companies separately. Bloomin’ Brands also disclosed a settlement agreement with Cerca Trova Southwest that reduced advertising fees to 2.25% of gross sales through December 27, 2026, or until specified events occurred earlier, including bankruptcy. The court’s decisions on the sale, operating and debtor-financing requests remain pending.