For the fiscal 12 months ending December 31, 2022, Popeyes franchisee Premier Cajun Kings had gross sales of $26 million and a internet working lack of $6.8 million, in accordance with its Chapter 11 chapter submitting final month. As of March 10, 2023, its stability sheet confirmed property of $10 million and liabilities of $20.1 million. However the important thing date was Could 24, 2022.
That is when its sole proprietor, Manraj “Patrick” Sidhu, died “all of a sudden and unexpectedly,” which “triggered nice operational instability” for Premier Cajun Kings, wrote Chief Restructuring Officer David Baker in its Chapter 11 submitting on March 14. On the time of the submitting, Premier Cajun Kings had 19 Popeyes shops nonetheless working and 11 closed areas with persevering with lease obligations.
“Upon Mr. Sidhu’s tragic demise, Joginder Sidhu turned the non-public consultant of Mr. Sidhu’s property, and as such, gained authorized and operational management over the debtor.” The property consultant employed Aurora Administration Companions, the place Baker is managing associate, on June 2, 2022, to supply monetary advisory companies, and later engaged Baker as Premier’s chief restructuring officer.
Now Baker is working to achieve sufficient money to maintain the operation going, together with paying its 398 staff, whereas he traces up patrons for the eating places. As of March 10, 2023, the debtor owed PNC Financial institution unpaid principal of greater than $8.2 million, on an asset-based time period mortgage dated Could 11, 2022.
AIM Associates Capital Group is the so-called stalking horse bidder, which means the primary bidder used to solicit extra bids, and an public sale of property will likely be scheduled. AIM, a personal fairness agency within the Miami space, bid $4.57 million for the property.
Baker didn’t reply to requests for remark, nor did Popeyes company or Restaurant Manufacturers Worldwide, which owns Popeyes.
Patrick Sidhu labored for Anand Gala, then a multi-unit restaurant franchisee and the proprietor of Gala Corp., within the early 2000s. “When Patrick labored for me, I discovered him to be extraordinarily clever, very hard-working, I’d even say tenacious,” Gala recalled in an interview this week. “He is the type of one that believed in being within the eating places, as an operator, working with the group, and actually growing relationships with them.”
Sidhu began with Gala as a district supervisor for Jack within the Field. “That developed into us asking him to take over all of our model operations, which included Del Taco and Applebee’s,” about 20 eating places whole.
“I discovered him to be a really inspirational operator, as a result of he can be within the shops. To me, he was an incredible operator and a extremely good individual,” Gala mentioned. “The rationale he left us, he bought married and his spouse and in-laws have been within the Midwest, and there was a chance for him to hitch their household enterprise, and we wished him one of the best.”
As we speak founder of personal funding agency Gala Capital Companions, Gala mentioned Sidhu “was the primary individual that impressed me a lot, that we supplied him an fairness partnership in our enterprise. He is the very first individual we ever thought of that for, however he had a lot greater alternatives in entrance of him, and we revered that.” Gala mentioned he wasn’t conscious of a lot that occurred after Sidhu left his agency.
Premier Cajun Kings was based in 2018 by Patrick Sidhu, who initially bought six Popeyes Louisiana Kitchen eating places within the Birmingham, Alabama, space, after which bought 24 extra in Alabama, Georgia and Tennessee. With 30 eating places, the debtor achieved gross sales of greater than $30 million in calendar years 2020 and 2021 and employed about 500 staff, the Chapter 11 filling mentioned.
Starting in January 2022, Premier Cajun Kings started an funding banking course of to solicit patrons for its 30 Popeyes eating places, leading to seven non-binding presents starting from $13.75 million to $26 million. “After continued due diligence by events, and nothing the debtor’s declining income and earnings developments, just one bidder remained with an adjusted supply of $16 million, the Chapter 11 submitting mentioned.
In June 2022, potential bidders discovered by means of disclosures that the debtor’s monetary statements for prior durations had been misstated, and in August 2022 bids have been obtained from $4.8 million to $6 million.