Minneapolis' Oceanaire Inc., the high-end seafood restaurant chain that tumbled into insolvency last year, will live on to ply its delicacies of the deep -- but under a new owner, Houston-based Landry's Restaurants Inc.
Oceanaire filed for Chapter 11 bankruptcy reorganization in July, one of scores of restaurant chains felled by a recession that bit deep into consumers' discretionary spending. Oceanaire closed four restaurants, but its other 12 outlets remained open, as is custom in Chapter 11, while the company looked for financial relief.
That relief is expected to come in a $24 million deal with Landry's, a publicly traded company with a stable of over 20 restaurant brands, including Rainforest Cafe, a concept also born in Minnesota. The deal needs federal bankruptcy court approval, which could come as early as next week.
The sale would provide $6.6 million for Oceanaire's creditors, while Landry's would assume about $17 million in Oceanaire debt, said Terry Ryan, Oceanaire's chief executive.
Oceanaire started as a single Minneapolis outlet in 1998. It was part of Parasole Restaurant Holdings -- progenitor of such other well-known Twin Cities restaurant concepts as Manny's Steakhouse and Chino Latino -- until it was spun off in 2001.
Oceanaire's majority owner has been New York-based Clarion Capital Partners, though it's now poised to lose its equity, Ryan said, a common occurrence in a Chapter 11 bankruptcy.
Oceanaire has been one of the Twin Cities' most successful restaurant exports in recent years. The company still operates in nine states, according to its website. The restaurants are built to feel like great seafood supper clubs of the 1930s and 1940s.
"It's a very well-operated business that got caught in some unfortunate leases and some bad economic times," said Tilman Fertitta, Landry's chief executive. "We love the fresh seafood aspect. We feel it fits in with our restaurants."
