The popularity of the fried chicken dining sector is not enough to prevent restaurants from filing for bankruptcy protection and going out of business if negative economic factors prevail.The rising cost of doing business and unsustainable debt are often cited as the top reasons for restaurants’ financial distress, forcing them to close businesses.Popeyes Louisiana Kitchen franchisee Sailormen Inc., which operated 136 fried chicken locations when it filed for bankruptcy in January 2026, has rejected 22 leases of locations that it could not sell and will permanently close them.
Popeyes franchisee Sailormen Inc. divests of all of its restaurant locations.Shutterstock
Sailormen disposes of all locations Sailormen will divest all of its Popeyes businesses after selling 97 of its restaurants to five buyers and closing the remaining 39 locations that it could not sell.The debtor had won approval in the U.S. Bankruptcy Court for the Southern District of Florida in Miami to reject 18 restaurant leases, consisting of 15 locations in Florida and 3 in Georgia, on June 24.Judge Robert A. Mark approved an amended motion on June 27 to add four lease rejections, which amounted to 19 leases for properties in Florida and 3 leases for Georgia locations.Franchisee filed for bankruptcySailormen Inc., which filed for Chapter 11 bankruptcy protection on Jan. 15, 2026, submitted a motion in January in the U.S. Bankruptcy Court for the Southern District of Florida to reject 17 leases retroactively to Jan. 15 after closing eight locations on Jan. 19, five locations on Jan. 20, and four locations on Jan. 22, according to court papers.The debtor asserted that the leases should be rejected as of the petition date, since the restaurants were closed within one week of the petition date and before the hearing on the debtor’s first-day motions.The Miami, Fla.-based wholly owned subsidiary of Interfoods of America Inc. believed that closing the 17 unprofitable locations would reduce its expenses by over $1 million annually.Operator sells 97 locationsThe franchisee subsequently won Mark’s approval on June 23 to sell 97 of its restaurants for a total of $16.55 million, according to court papers.The restaurants included 50 Florida Popeyes locations sold to Pulse Restaurant Group LLC for $2.69 million, 23 Orlando-area restaurants to RFI Ventures LLC for $2.5 million, 16 Miami-area stores to Popeyes Louisiana Kitchen Inc. for $9.6 million, 5 Savannah, Ga., locations to SBH Foods PLK LLC for $650,000, and 3 West Palm Beach, Fla.-area restaurants to 61 Biscuits LLC for $1.11 million, according to court orders.Sailormen filed for Chapter 11 protection after a failed sale of certain locations, a default on credit facilities, and a series of lawsuits and store closings caused the company financial distress.The franchisee, which was founded in 1987 with 10 locations, was one of the largest domestic Popeyes franchisees in the company’s system, with 136 locations in Florida and Georgia before it began closing locations. It employed about 2,900 workers before the closures.Fried Chicken most popular fast foodFried chicken dining chains were the most popular subsector of the fast-food industry in 2025, as traffic to chicken concepts increased by 3% for the year ending September 2025, while all concepts dropped 1% compared to the previous year, according to market research firm Circana.The popularity of fried chicken chains can be traced to the variety of chicken options offered at restaurants, such as chicken pieces, chicken fingers, or chicken sandwiches, and how consumers enjoy their choices, an expert says.“This is due to the experiences the brands are creating as well as the variety of chicken and how you can enjoy it,” industry expert Reilly Newman of Motif Brands told The Food Institute. “This comes to no surprise, as the experience economy has been taking root across the globe.Sailormen divested properties:92 Florida restaurants sold.5 Georgia restaurants sold.39 locations closed, leases rejected. Source: U.S. Bankruptcy CourtRelated: Giant troubled satellite TV company files Chapter 11 bankruptcy