Friendly's Seeks Chapter 11 Protection, Shutters Restaurants
Wilbraham-based Friendly Ice Cream Corp. filed for Chapter 11 bankruptcy protection today and shuttered 11 of its restaurants in Central Massachusetts.
The restaurant chain announced it had closed a total of 63 underperforming restaurants on the East Coast. The remaining 424 restaurants will remain open during a planned restructuring.
Friendly will enter a sale process with an affiliate of its current owner, Sun Capital Partners, which will act as a lead bidder to restructure the company.
Central Massachusetts communities where Friendly's shuttered one or more restaurants include: Acton, Fitchburg, Leominster, Southbridge, West Boylston, Westborough, Whitinsville and Worcester.
The company said in a press release that the decision to file for bankruptcy protection was driven by the economic downturn and increased costs for rents and commodities such as cream.
It has secured approximately $70 million in debtor-in-possession financing, which will help provide the company with working capital needed to meet ongoing obligations, including employee salaries and benefits.
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