Red Lobster is exiting Chapter 11 bankruptcy after a federal judge on Thursday approved the seafood restaurant chain's plan to rebound from an "endless shrimp" fiasco, massive debt, dozens of location closures and an overall decline in guests.

As part of Red Lobster's Chapter 11 plan, RL Investor Holdings LLC − a newly formed entity organized and controlled by Fortress Investment Group LLC − will acquire the restaurant chain. The acquisition is expected to be completed by the end of the month, Red Lobster said in a news release.

Red Lobster will be Fortress' most recent acquisition of a company that has filed for bankruptcy, following the purchases of Vice Media and the Alamo Drafthouse, which has since been sold to Sony Pictures Entertainment.

Fortress also controls a company called SPB Hospitality, which owns brands such as Logan's Roadhouse, Krystal, Old Chicago Pizza & Taproom and Twisted Tenders, spokesperson Gordon Runté said.

"It's definitely an area where we have a lot of experience," Runté told USA TODAY about acquiring another struggling restaurant. "Red Lobster is a big undertaking, it is 500-plus locations, but we're excited about the prospects for the restaurant."

'This is a great day for Red Lobster'

Once the acquisition is complete, Damola Adamolekun will become the CEO of the Red Lobster restaurant chain and take over for former CEO Jonathan Tibus, who will step down from the role and leave the company. Adamolekun was formerly CEO of P. F. Chang's.

"This is a great day for Red Lobster," Adamolekun said. "With our new backers, we have a comprehensive and long-term investment plan – including a commitment of more than $60 million in new funding – that will help to reinvigorate the iconic brand while keeping the best of its history."

"Red Lobster has a tremendous future, and I cannot wait to get started on our plan with the company's more than 30,000 team members across the USA and Canada," he said.

Following the court's approval, Red Lobster will continue to operate as an independent company and maintain 544 locations across 44 U.S. states and four Canadian provinces, the company said.

"I'm proud of what Red Lobster has achieved during this restructuring – the Company will emerge from Chapter 11 stronger financially and operationally, and with new backers who are resolutely focused on investment and growth, " Jonathan Tibus said in the release.

Red Lobster closed 23 locations last week

Red Lobster recently closed 23 more restaurants across the nation.

The recent restaurant closures brought the total closures to at least 129 across the U.S. The most recent wave included three locations in Florida, Illinois and Virginia; two in Minnesota and New York; and one in each of the following states: Arizona, California, Colorado, Georgia, Indiana, Missouri, North Carolina, Ohio, and South Carolina.

Why did Red Lobster file for Chapter 11 bankruptcy?

Red Lobster filed for bankruptcy on May 19 after closing dozens of locations and announcing that the chain intended to "drive operational improvements" by simplifying the business. Documents later filed in the Middle District of Florida revealed that the bankruptcy was due to significant debt, a carousel of CEOs, an all-you-can-eat shrimp debacle and a 30% drop in guests since 2019.

"Recently, the debtors have faced a number of financial and operational challenges, including a difficult macroeconomic environment, a bloated and underperforming restaurant footprint, failed or ill-advised strategic initiatives, and increased competition within the restaurant industry," Tibus said in the bankruptcy documents.

Tibus, who was serving as Red Lobster's chief revenue officer on Jan. 11, before being named CEO, said in the documents that "it was immediately clear that Red Lobster's performance was deteriorating and had been doing so for several years."

Contributing: Natalie Neysa Alund and Gabe Hauari/ USA TODAY