On The Border Mexican Grill & Cantina shut down all of its company-owned restaurants after service on Friday, leaving the chain with only a small franchised footprint as OTB Hospitality weighs what comes next for the brand.
The closures appear to cover 27 restaurants, a sharp drop for a chain that listed 33 units on its website before Friday’s shutdowns. Five franchised U.S. locations remain open in South Dakota, Florida, Nevada and California, and at least one franchised restaurant in South Korea is also still operating.
OTB Hospitality said the move followed a thorough evaluation of the business and that it is now reviewing the future of the On The Border brand while exploring a range of strategic options. The company said its immediate focus is on supporting team members through the transition and ensuring an orderly and respectful closure.
That leaves the brand in a far leaner position than it held last March, when Pappas Restaurants acquired On The Border out of bankruptcy with 80 restaurants and said it planned to modernize the chain’s restaurants and update its menu and operations. The company-owned closures now mean that plan will not play out across the system in the form originally promised.
The gap between the acquisition pitch and Friday’s outcome is hard to miss. On The Border had already been under strain for years, with persistent sales declines starting in 2008, total sales of $152 million and a unit count that was cut by 42% last year alone. By the end of last year, Technomic said the chain was down to 57 locations, after 77 struggling restaurants had already closed leading up to the filing.
On The Border was founded in Dallas in 1982 and once reached 166 locations in 2007 before being acquired by Chili's owner Brinker International in 1994, sold to Golden Gate Capital in 2010 and then to Argonne Capital Group in 2014. The chain, known for Tex-Mex fare such as fajitas, margaritas and guacamole, had become the fifth-largest Mexican casual-dining chain in the country.
For now, the unanswered question is not whether the company-owned restaurants are gone. It is which path OTB Hospitality will choose for a brand that has already been stripped down, bought, sold and reshaped more than once, and whether the remaining franchise base is enough to give On The Border a future at all.
