The Australian arm of US restaurant chain Hooters – famous for hiring buxom waitresses – has been placed in liquidation, although the sale of two of its remaining restaurants is imminent.
The latest incarnation of the Hooters chain in Australia was set up in 2005, with restaurants in the Sydney suburbs of Parramatta and Cronulla and in the glitzy Gold Coast suburb of Mermaid Beach.
The Cronulla site was closed before the company was placed in administration in March, but the Parramatta and Mermaid Beach restaurants remain open.
According to Murray Godfrey, the liquidator of Hooters holding company Wings-Aus Holdings, interests associated with the US chain have invested around $4.6 million to set up the Australian operations, including $1 million to set up each restaurant. The company’s total debts are around $4.8 million.
Godfrey says investors and creditors must now wait for the individual restaurants to be sold by Richard Brennan of RT Hospitality Solutions, who is the liquidator for the individual sites.
A spokesperson for Brennan says a sale is “very close”. Godfrey says the final stage of any deal will involve getting the approval of Hooters in the US to continue to license the brand.
So what went wrong?
Godfrey says the financial crisis that has hit many restaurants has been one problem, although the location of the sites has not helped.
“The location of the restaurants is probably not ideal. With a name like Hooters they are probably not going to attract a family crowd and a lot of the sites are destination sites that you actually have to make a trip to, they’re not in a restaurant precinct.”
Godfrey says the deadline for a sale is a “couple of months away”.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
