GEN Restaurant Group, Inc. (Nasdaq: GENK) announced on November 10, 2026, that it has entered into a binding letter of intent with Chubby Group, Inc. to sell the operations of 47 U.S. locations of its GEN Korean BBQ restaurant brand. The transaction is valued at up to $100 million, with the parties currently negotiating definitive agreements.
Under the terms of the agreement, GEN will retain full ownership of the GEN brand and its consumer-packaged goods (CPG) business. The company will also retain its restaurant in Cerritos, California, which is intended to serve as a training, staffing, and research and development hub. The 47 restaurants are expected to transition to Chubby Group in four phases over a 12-month period. GEN will continue to operate the restaurants until the handover, and Chubby is expected to fund every conversion and buildout with its own capital.
The company stated that the transaction is expected to substantially reduce its operating lease liabilities and add a secured note as an asset. GEN anticipates that it will eliminate its outstanding debt as it receives payments from Chubby. Following the debt elimination, the company indicated it expects to have flexibility in capital allocation, potentially including the return of capital to shareholders in the form of a buyback or dividend.
In conjunction with the sale announcement, GEN reported its financial results for the third quarter ended September 30, 2026. Revenue for the quarter totaled $48.7 million, a decrease of 3.3% compared to the same period in the prior year. Restaurant revenue was $44.0 million, a decrease of 12.7%, which the company attributed to a 9.2% decline in comparable restaurant sales and a reduction in the number of restaurants in the base.
For the quarter, the company reported a loss from operations of $6.0 million, or 12.4% of revenue, and a net loss of $5.5 million, or $0.16 per share. General and administrative expenses decreased by 15.3% year-over-year to $5.5 million, reflecting reductions in corporate costs and lower stock-based compensation. The company also noted that it generated CPG revenue of $4.7 million in the third quarter of 2026, compared to no revenue in the prior-year period.
As of September 30, 2026, cash and cash equivalents totaled $2.9 million, and total debt outstanding was $26.8 million. GEN’s CPG business has expanded its retail distribution to more than 2,000 doors nationwide, including new placements at Bristol Farms, Vallarta Supermarkets, and Olé City Market, as well as university dining and live-entertainment venues such as UCLA and SoFi Stadium.
