Ryan’s closes; 50 are jobless|[02/12/08]

Published 12:00 am Tuesday, February 12, 2008

Doors were closed to Ryan’s Family Steak House on Pemberton Boulevard Monday, a surprise to patrons and about 50 employees called to a mandatory meeting at the 12-year-old buffet restaurant.

“I don’t think it’s fair,” said cook Timothy Hardman, who said he found a note on the restaurant door. “They could have given some warning. I’ll try to find another job. It’s all I can do.”

The sudden shutdown was said to be the result of an ongoing bankruptcy reorganization by the parent company, a fate that also befell the former Kmart, across the street several years ago.

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The parent company, Buffets Holdings Inc. of Eaton, Minn., had not said which restaurants would be closed when it announced last month that it had filed for Chapter 11 bankruptcy. Instead, it said it was “performing a thorough review of all underperforming locations over the next several months to determine if they can meet our long-term objectives.”

A company spokesman said “a number” of stores nationwide had closed Sunday and Monday and at least a few more were expected.

“We don’t expect a significant number,” said Michael Freitag of New York-based Kekst and Company, to whom Ryan’s officials referred questions.

Buffets Holdings operates 626 restaurants in 39 states, specifically the Ryan’s, Old Country Buffet, HomeTown Buffet and Fire Mountain franchises.

In its release regarding its bankruptcy filing, the company noted a decline in profits from numerous economic conditions including higher energy costs, a downturn in the housing and credit markets, the recent increase in the minimum wage and lower consumer spending nationwide. “We expect that our 37,000 team members will continue to receive their pay and benefits as usual and I know they will continue to provide outstanding meals and service to our guests,” Buffets Holdings CEO Mike Andrews said in the release.

Local managers made no comment on the closing.

“Maybe I’ll get unemployment for a little while,” said Patricia Gulley, a server and cashier with 10 years’ experience. “But I have four children …”

Since its opening in Vicksburg in 1996, Ryan’s had served individuals as well as promoting churches and community groups. One event, now expected to be canceled, was a business breakfast organized by the Vicksburg-Warren County Chamber of Commerce and set for March 25.

Ryan’s first opened in South Carolina in 1977 and lists 23,300 employees nationwide. The company lists 11 Mississippi locations on its Web site.

Shortly after its $834 million acquisition of the Ryan’s brand in November 2006, the company said in filings with the federal Securities and Exchange Commission that it planned to sell about 44 underperforming or previously closed locations of the steak-buffet restaurants. Filings also show about $146.9 million in the Ryan’s brand’s debt was assumed by Buffets Holdings Inc. and plans were in the works for about $17 million in cost savings stemming from labor policy changes and production practices.

Pemberton was built in 1984 as the access road to Pemberton Square mall. It quickly became one of the city’s most-traveled streets, lined with a variety of shops, eateries and the area’s main U.S. Postal facility. Kmart was the street’s largest freestanding store. In 2006, Kroger announced acquisition of the property and plans to relocate its grocery from the east side of Pemberton to the west side.