Shake Shack (SHAK) - Get Report said it would return a small business loan it received from the U.S. government to help it through the coronavirus pandemic after it received extra funding late last week.
Shake Shack announced last week it would furlough or lay off 1,000 employees and CEO Randy Garutti and founder Danny Meyer said in a statement seen Monday the company needed the assistance.
But the burger chain was able to get extra funding late last week through an “equity transaction” and decided to “immediately return” the $10 million paycheck protection loan it obtained through the CARES Act, the Associated Press reported.
“We’re fortunate to now have access to capital that others do not. Until every restaurant that needs it has had the same opportunity to receive assistance, we’re returning ours,” the statement said.
According to Bloomberg, more than a dozen publicly traded companies with revenue topping $100 million received funds from the government program before it ran out of money.
The Trump administration and Congress could announce an agreement Monday on an aid package of up to $450 billion to boost the small-business loan program. It would add funds for hospitals and coronavirus testing.
“Shake Shack was fortunate last Friday to be able to access the additional capital we needed to ensure our long term stability through an equity transaction in the public markets,” Garutti and Meyer said.
“We’re thankful for that and we’ve decided to immediately return the entire $10 million PPP loan we received last week so that those restaurants who need it most can get it now,” they added.