What Does Friendly’s Chapter 11 Bankruptcy Filing Mean?

Friendly’s Restaurants is the latest restaurant chain to find itself in bankruptcy amid the pandemic as its parent company, FIC Restaurants, filed for Chapter 11 on Monday.

Under the bankruptcy filing, Friendly’s will assume a new owner in Amici Partners Group, which will acquire all of its assets. The deal is said to be valued at $2 million, it said in its bankruptcy filing (via RetailDive).

The company said that nearly all of its 130 corporate-owned and franchised locations will remain open unless restricted by COVID-19 limitations. Friendly’s also said the deal will save thousands of jobs at its restaurants by partnering with Amici, which operates RedBrick Pizza, Smoothie Factory and other restaurants.

Through the bankruptcy filing, Friendly’s is asking the court for a concurrent sale of the company as well as approval of its Chapter 11 restructuring plan. The restaurant chain said it has sufficient cash on hand to continue its operations and meet all obligations.

“We believe the voluntary bankruptcy filing and planned sale to a new, deeply experienced restaurant group will enable Friendly’s to rebound from the pandemic as a stronger business, with the leadership and resources needed to continue to invest in the business and serve loyal patrons, as well as compete to win new customers over the long-term,” George Michel, CEO of FIC Restaurants, said in a statement.

“Importantly, it is also expected to preserve the jobs of Friendly’s restaurant team members, who are the heart and soul of our enterprise and have been critical to the progress we have made in transforming this iconic brand,” he added.

Friendly’s, which has been operating for more than 80 years and is best known for its ice cream desserts, joins a growing list of restaurants that have filed for bankruptcy during the pandemic. Recently, Chuck E. Cheese, California Pizza Kitchen, Ruby Tuesday’s, and Garden Fresh Restaurants’ Souplantation and Sweet Tomatoes have filed for Chapter 11 during the COVID-19 crisis.