Friendly’s, the restaurant chain famous for its ice cream sundaes and burgers announced today that it filed for Chapter 11 bankruptcy protection and will close 63 of its restaurants, including four in Central Virginia.
It will close its locations on Patterson Avenue, Brook Road, Fribble Way in Midlothian, and one in Colonial Heights.
The chain filed Chapter 11 in Delaware Federal Court. As part of the process, Friendy’s secured approximately $70 million in financing and will continue to operate 424 of its restaurants.
The bankruptcy arises as the 76-year-old restaurant chain found itself riddled with $250 million in debt, according to a report in the Wall Street Journal.
In a prepared statement, Harsha V. Agadi, Chairman & CEO of Friendly’s, cited the economic downturn as a reason for the bankruptcy filing:
“Thanks to our dedicated employees and franchisees, we have made a lot of progress, but our Company continued to face significant financial challenges. This was exacerbated by the weak economy and rapidly rising commodity costs that have impacted the entire restaurant industry. The strategic decision to pursue a financial restructuring will allow us to proactively and quickly improve our financial position and ensure we have the resources to build a better and stronger Friendly’s for our loyal guests, retail customers, suppliers and other business partners.”
Friendly’s was founded in 1935 in Springfield, Mass. It is owned by Sun Capital Partners, a Florida private equity firm that bought it in 2007.
See the full list of closed stores here.
Friendly’s, the restaurant chain famous for its ice cream sundaes and burgers announced today that it filed for Chapter 11 bankruptcy protection and will close 63 of its restaurants, including four in Central Virginia.
It will close its locations on Patterson Avenue, Brook Road, Fribble Way in Midlothian, and one in Colonial Heights.
The chain filed Chapter 11 in Delaware Federal Court. As part of the process, Friendy’s secured approximately $70 million in financing and will continue to operate 424 of its restaurants.
The bankruptcy arises as the 76-year-old restaurant chain found itself riddled with $250 million in debt, according to a report in the Wall Street Journal.
In a prepared statement, Harsha V. Agadi, Chairman & CEO of Friendly’s, cited the economic downturn as a reason for the bankruptcy filing:
“Thanks to our dedicated employees and franchisees, we have made a lot of progress, but our Company continued to face significant financial challenges. This was exacerbated by the weak economy and rapidly rising commodity costs that have impacted the entire restaurant industry. The strategic decision to pursue a financial restructuring will allow us to proactively and quickly improve our financial position and ensure we have the resources to build a better and stronger Friendly’s for our loyal guests, retail customers, suppliers and other business partners.”
Friendly’s was founded in 1935 in Springfield, Mass. It is owned by Sun Capital Partners, a Florida private equity firm that bought it in 2007.
See the full list of closed stores here.