Friendly’s Restaurant parent files Chapter 11; announces sale

FIC Restaurants has filed for bankruptcy protection with plans to sell itself.

The parent company of Friendly’s Restaurants announced an agreement to sell “substantially all” of its assets to Amici Partners Group, an entity affiliated with BRIX Holdings whose franchise portfolio includes Red Mango Yogurt Café Smoothie & Juice Bar, Smoothie Factory, Juice Bar, RedBrick Pizza Kitchen Cafe and Souper Salad chains.

To facilitate the sale, Friendly’s  filed for Chapter 11 bankruptcy protection and also filed a motion seeking approval of the sale to Amici along with a  Chapter 11 plan that contemplates payment of all allowed claims. Friendly’s asked the bankruptcy court to approve of the sale in mid-December.

Nearly all of Friendly’s 130 corporate-owned and franchised restaurant locations are expected to remain open (subject to COVID-19 limitations). 

“Over the last two years, Friendly’s has made important strides toward reinvigorating our beloved brand in the face of shifting demographics, increased competition, and rising costs,” said George Michel, CEO of FIC Restaurants. “Unfortunately, like many restaurant businesses, our progress was suddenly interrupted by the catastrophic impact of COVID-19, which caused a decline in revenue as dine-in operations ceased for months and re-opened with limited capacity.”

Friendly’s said it has sufficient cash on-hand to continue operations, meet its obligations to employees, franchisees and vendors, and ensure a seamless transition. 

“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,” Michel added. “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.”

Womble Bond Dickinson LLP is serving as Friendly’s legal counsel. Duff & Phelps is serving as investment banker, and Carl Marks Advisors as financial advisor.