Houston's own Pappas Restaurants is gearing up to spice up its culinary lineup after placing the winning bid to acquire On the Border Mexican Grill & Cantina from the clutches of bankruptcy. The famed Irving-based Tex-Mex chain, which succumbed to Chapter 11 back in March, now looks set to merge into the fold of the Pappas brand, with a court's nod still pending. According to a statement obtained by KHOU, the sale hearing is slated for May 16, and if all goes well, the acquisition should seal the deal within weeks.
Pappas Restaurants casts a long shadow with over 80 units spanning nine concepts, and On the Border's inclusion is expected to not just broaden the company's national reach but also bulk up its store count by 60. OTB Lender, an affiliate of Pappas Restaurants, had previously tossed a lifeline of $10 million in debtor-in-possession financing, thus also setting themselves up as a stalking horse bidder. "Our shared Texas roots and passion for hospitality make this a natural fit," Mike Risso, CEO of Pappas Restaurants, told Restaurant Dive.
The value-driven ethos of On the Border chimes in harmoniously with Pappasito’s Cantina's offerings, promising an accessible price point for bold flavors. Pitching itself as the custodian of On the Border's legacy, Pappas aims to finetune the menu, uplift the operational standards, and enhance the overall guest experience while giving a nod to the brand's historical appeal. This strategic move follows On the Border's February decision to close 40 underperforming spots due to hefty financial burdens.
Once boasting 150 units, On the Border now operates across 18 states, with an additional 20 franchised locations in the U.S. and South Korea. Pappas Restaurants plans to lean heavily on their proven track record of successful brand management—"honoring the brand’s history and fan-favorite offerings," as mentioned in a press release captured by Restaurant Dive.
