The parent of the Friendly’s restaurant chain filed for Chapter 11 bankruptcy protection on Wednesday and said that it has already closed 63 of its stores, including seven in Connecticut, The Associated Press reports.
Each store employed about 20 people, so about 1,260 jobs were lost nationwide. Connecticut lost about 140 jobs.
The locations closed in Connecticut were on South Main Street in West Hartford, in the Shoppes at Buckland Hills in Manchester, in the Waterbury Shopping Plaza, on Main Street in Meriden, at University Plaza in Storrs, on East Main Street in Torrington and on Boston Post Road in Guilford.
Following the closures, Friendly’s has 33 stores remaining in the Hartford area, which are scheduled to remain open during the bankruptcy.
Hartford-based FM Facility Maintenance is one of the larger creditors owed money by Friendly’s, roughly $3.5 million, according to the Springfield Republican. FM provides outsourced facility maintanence work for its clients.
The 76-year-old company based in Wilbraham, Mass. known for its ice cream and hamburgers is the latest restaurant chain to file for bankruptcy, as consumers continue to eat out less, a habit they picked up during the recession, and food costs remain high.
Other companies that have sought bankruptcy protection this year include Perkins & Marie Callender’s; Real Mex, which operates El Torito Restaurant and Chevys Fresh Mex, and SSI Group Holding Corp., which operates Souper Salad and Grandy’s restaurant.
Friendly’s said the economic downturn coupled with higher costs and high rents drove it to file for bankruptcy protection.
“The strategic decision to pursue a financial restructuring will allow us to proactively and quickly improve our financial position,” said CEO Harsha V. Agadi.
Friendly Ice Cream Corp. says it has secured $70 million in financing and that its 424 remaining restaurants will stay open and pay employee salaries and benefits as it reorganizes under bankruptcy protection. Gift cards will continue to be honored. Friendly’s now employs about 9,000 workers.
Its current owners, Sun Capital Partners, will be the lead, or “stalking horse” bidders, in an auction process.
The company filed for bankruptcy protection at the United States Bankruptcy Court for the District of Delaware.
