Outback’s Largest Franchisee Collapses Under $449M Debt, Bloomin’ Brands Steps In
Bloomin' Brands to acquire 61 locations for $26.3M as casual dining sector struggles
The numbers tell the story better than any filing: $449 million in debt, 61 restaurants across five states, and a cash pile that evaporated from $9.7 million to $3.4 million in barely a year.
Out West Restaurant Group — still known in court documents as Cerca Trova Restaurant Group — filed for Chapter 11 protection on November 2 in Delaware. The San Diego-based franchisee once ran 99 Outback Steakhouses. That was 2018. The contraction since then mirrors a casual dining sector that has been bleeding guests for years.
David Goronkin, the company’s chief executive, put it bluntly in his declaration: “By 2026, the pressures on the business had converged. Guest traffic and earnings continued to decline, while food, labor, and other production costs continued to rise.”
Labor costs hit hardest in California, where more than half of Out West’s workforce clocks in. The state minimum wage reached $16.90 an hour on January 1. Full-service restaurants escaped the $20 fast-food floor that took effect in April 2024, but the ripple effect pushed everyone’s payroll up.
Then there’s beef. The single biggest line item on the menu. Costs surged 15 to 20 percent in 2022 alone, then kept climbing 5 percent a year after that. You don’t absorb that on a Bloomin’ Onion margin.
A $1.6 million wage-and-hour class action settlement landed in August. Two more class actions followed that summer. The cash bleed accelerated.
Bloomin’ Brands, the Australian-owned parent company, didn’t wait for the auction. They signed on as stalking-horse bidder: $26.3 million for the assets, plus $5.5 million in interest-free debtor-in-possession financing to keep the lights on. A spokesperson called it an “isolated situation” that doesn’t touch corporate liquidity.
If the sale clears court, Bloomin’ Brands takes 61 franchised locations back under direct management. Red Lobster went through Chapter 11 last year. True Food Kitchen, backed by Oprah Winfrey, filed earlier in 2026. The pattern isn’t new. The question is whether company-owned operations can solve what franchising couldn’t.
