Luby’s, the beloved Texas cafeteria chain and home of the famous LuAnn platter, is looking to sell its restaurants and assets, the company announced Wednesday.
The Houston-based company’s board decided to pursue the sale after a review of operations that included the effect of the coronavirus pandemic, according to a news release.
The company has three Luby’s cafeterias in McAllen, as well as locations in Mission, Pharr, Edinburg, Weslaco, Harlingen and Brownsville.
Luby’s, Inc. also owns burger chain Fuddruckers and contract food service Culinary Contract Services. Both are included in the company’s sale plan, according to the release, but the company has not set a timeframe for the sale. According to the release, a sale of the entire company is also on the table.
By March 31, Luby’s had suspended operations at most locations amid the coronavirus pandemic and enacted widespread furloughs and pay cuts. The company last month began reopening some restaurants.
The company is pursuing the sale to pay off debts, with any remaining proceeds distributed to shareholders, according to the release.
The company’s plan “provides for the potential to place the restaurant operations with well-capitalized owners moving forward,” Christopher J. Pappas, CEO and president of Luby’s, said in a statement.
Luby’s “faced a contentious proxy fight last year from one of its investors who pushed for leadership changes amid lagging sales,” according to a Houston Chronicle report about the sale.
The company has weathered financial woes in recent years, including the closing of many of its restaurants. According to the Chronicle, Luby’s reported a loss of $3.8 million during its second quarter, down from $6.6 million in earnings over the same time period last year.
“The chain reported second-quarter revenue of $68.6 million, down 7.8 percent from the $74.4 million revenue a year ago,” the Chronicle reports.
Founded in 1947 in San Antonio by Bob Luby, the chain of cafeterias for many Texans is synonymous with Sunday lunch and family meals. For fans, cherished dishes like golden fried fish and creamy macaroni in cheese are nostalgic staples. Even popular culture pays tribute to Luby’s sometimes; the character of LuAnn Platter on Mike Judge’s animated comedy “King of the Hill” was named after a portion size available at the cafeteria.
Luby’s currently sells some of its most iconic dishes in frozen food aisles at H-E-B stores: macaroni and cheese and fried fish.