Portland, Ore.-based Blue Star Donuts, which declared Chapter 11 bankruptcy in August, emerged from those protections earlier this month with a reorganized business plan, the chain announced.
Blue Star received new capital from investment group Sortis Holidings, which sponsored the Chapter 11 plan, to fund new growth and resolve disputes with creditors, the chain said.
Blue Star, which launched its gourmet doughnut concept in 2012, had eight units pre-pandemic. It has since permanently closed four of those locations.
Blue Star has added new wholesale partnerships with area grocery stores, including New Seasons and Green Zebra Grocery. It is also expanding its shipping business, the chain said.
“We’re incredibly grateful to be able to maintain positions for our existing staff members, as well as to continue to support the local vendors and community partnerships we value so much,” co-founder and CEO Katie Poppe said in a statement.
In the bankruptcy filing, Poppe said finding new revenue streams was essential for Blue Star’s future. That progress had been hampered by an ongoing dispute with the landlord who owns the brand’s production kitchen space, she said.
“Building out a wholesale and e-commerce delivery operation required—first and foremost—creating a product with a longer shelf-life from time of production to consumption, as well as a product that could be frozen to extend its shelf-life,” Poppe wrote. “Already, the company has made significant progress.”
Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.