The group’s restaurant in Prestwich shut its doors earlier this week, a few months after the lease for the site was listed on Rightmove.
It comes after the group closed its sites in Leicester, Birmingham, Barnet and Brighton in recent months.
The closures leaves Karen’s Diner, which is owned by Australian parent company Viral Ventures Global, with just a single UK restaurant in London.
In a statement provided to Manchester Evening News, a spokesperson confirmed that the group’s UK operation would be turning its attention to ‘pop up’ events rather than opening new restaurants.
They said: “As it stands the initial licence agreement has come to an end and our head office wants the UK operation to concentrate on ‘pop up’ events rather than restaurants. In the current climate reluctantly we can understand their decision.
“When the business opened in Prestwich critics said that is was “far too far out the way” and we want to thank the 100,000 + customers that have proved them wrong.
“The group is undergoing a reconstruction, which will see the brand appearing in its pop up form all over Britain.
“Our admin team will ensure that customers with bookings will be informed of next steps.”
Karen’s Diner, whose name and concept is inspired by a pejorative stereotype of a white, 1970s-born woman who is prone to asking for the manager, has often courted controversy since arriving on UK shores back in 2022.
In March this year, the group’s restaurant in Prestwich hosted a guest appearance by controversial far-right commentator Katie Hopkins, which led to police being called to 'monitor' a 'small number of protesters' after demonstrators from organisations Stand Up To Racism and Unite Against Fascism gathered outside the restaurant.
Meanwhile, traces of drugs including cocaine, heroin, MDMA and ketamine were found in the group’s Brighton restaurant, which led to its closure.
Karen’s Diner announced plans for a summer tour last month that will see various pop up events across the country between June and September in locations including Romford, Blackpool, Liverpool, and Plymouth.