Nine of the 26 Fatburger locations being sold out of bankruptcy have stalking horse bidders heading into an auction scheduled for April 21.
Though the bidders were not identified in court documents, officials coordinating the sale said the stalking horse candidates include existing franchisees, aspiring franchisees, and operators of other chains hoping to convert the properties.
The Fatburger locations include corporate units operated by subsidiaries Fatburger Restaurants of California Inc. and Fatburger Restaurants of Nevada Inc., which both filed for Chapter 11 bankruptcy protection in April 2009. Santa Monica, Calif.-based parent company Fatburger Corp. is not part of the bankruptcy filing.
The auction will include 13 locations in California and 13 in the Las Vegas market.
The nine locations with stalking horse bids include:
--Unit 110 in Sherman Oaks, Calif., with a bid of $60,000
--Unit 109 in Hollywood, Calif., with a bid of $375,000
--Unit 137 in Cabazon, Calif., with a bid of $60,000
--Unit 115 in West Hollywood, Calif., with a bid of $165,000
--Unit 116 in Woodland Hills, Calif., with a bid of $60,000
--Unit 138 in Las Vegas with a bid of $110,000
--Unit 143 in Henderson, Nev., with a bid of $120,000
--Unit 132 in Henderson with a bid of $110,000
--Unit 131 in Las Vegas with a bid of $120,000
The stalking horse bidders are entitled to a “breakup fee,” subject to court approval, if their offer is not determined to be the highest and best at the live auction.
Those units with no potential stalking horse buyers have minimum bids ranging from $5,000 to $1.5 million, the latter for a unit on the Las Vegas Strip.
National Franchise Sales is handling the sale and auction, which will be held near their offices in Newport Beach Calif.
The Fatburger chain comprises 104 locations worldwide, including about 74 franchised locations.
The bankruptcy cases are being heard in the U.S. Bankruptcy Court for the Central District of California, San Fernando Valley division.
Contact Lisa Jennings at [email protected].
