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Tuesday, July 29, 2008

Bennigan's, Steak & Ale Forced to Shut Down

FOXBusiness

Today marked the end of an era for fans of restaurant chains Bennigan's and Steak & Ale.

The parent company of both restaurants, Metromedia Restaurant Group, filed for Chapter 7 bankruptcy protection and ordered employees on Monday not to open the restaurants on Tuesday, because there wouldn’t be enough money to pay them for the rest of the week, according to a report in the Wall Street Journal.

The chain will close more than 300 Steak and Ale, Bennigan's and Tavern restaurants in one of the largest restaurant bankruptcy filings. According to the Journal, the restaurants are not likely to reopen, however, Ponderosa and Bonanza, two chains also operated by Metromedia, will not close.

The bankruptcy comes at a time when restaurant chains are suffering from high food prices and a drop in consumer spending. Many other chains are struggling, including the Village Inn, Bakers Square and Old Country Buffet, whose parent company filed for Chapter 11 earlier this year.

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