Posted on 06/13/2011 2:31:41 PM PDT by NorCoGOP
The owner of the Perkins and Marie Callender's restaurant chains filed for bankruptcy Monday with plans to close 65 of its 600 locations and cut 2,500 jobs, according to court documents.
Perkins & Marie Callender Inc. became the latest food company to fall victim to a sluggish recovery and soaring food prices. Last week, chicken producer Allen Family Foods tumbled into bankruptcy.
Perkins Restaurant & Bakery, which offers all-day breakfasts, plans to emerge from bankruptcy by giving ownership of the chain to holders of the company's unsecured debt, led by funds managed by Wayzata Investment Partners.
The bankruptcy will wipe out the investment of private equity firm Castle Harlan Inc., which acquired the Perkins chain in 2005 for $245 million.
The Marie Callender Restaurant & Bakery chain, known for pies and home-style meals, was added a year later for $140 million.
Joseph Trungale, who has been president of Perkins & Marie Callender's Inc. since 2004, said in court documents that the company was hard hit by a weak economy in states that suffered the worst of the U.S. housing crash, particularly Florida and California.
He also blamed competitors able to free up money to invest in new locations in their own bankruptcy filings.
In recent years, Uno Chicago Grill pizza, Fuddruckers, Charlie Brown's Steakhouse and Sbarro's have used bankruptcy to shed debt and revive their businesses.
Perkins was founded in 1958 as a pancake house in Ohio. Marie Callender founded the chain that bears her name in 1948 in Orange County, Calif., as a wholesale pie business. Combined, the two chains employed about 12,000 before Monday's job reduction announcement.
The Memphis-based company listed total assets at $290 million and liabilities at $440.8 million in its Chapter 11 petition. Eleven of its affiliates were included in the bankruptcy filing.
It said it had about $103 million in secured notes debt and $190 million in unsecured notes outstanding. It plans to borrow up to $21 million to fund its operations while in bankruptcy.
Last year's sales were about $507 million.
As part of the bankruptcy, the company sold its Marie Callender trademarks to ConAgra Inc. ConAgra had licensed the name for Marie Callender frozen foods it produced.
The bankrupt company received a license to continue to use the name in connection with its restaurants and baked goods.
The case is in re: Perkins & Marie Callender's Inc., U.S. Bankruptcy Court, District of Delaware, No. 11-11795.
Less bad food available.
The 3 western Washington Marie Calendar’s restaurants closed their doors yesterday. Believe it or not, customers still inside told to leave. In one case a birthday party for 65 people was going on.
I can only speak for my local Perkins but the food has been mediocre (and once gawd awful) and overpriced for many years now. The location is good so they always have business though. If a place is that bad for that long it’s not a management issue. There are obviously problems at the top.
The Obama economy strikes again
As far as “less bad food” - I love Perkins muffins!!!!
Suppliers and other creditors get stiffed. My question is, what suppliers and creditors would continue to do business with the remaining stores in the chain?
they must not have gotten an obamacare waiver?
I guess they weren’t ‘too big to bail out”. ha.
If it wasn’t for the bankruptcies and unemployment, the economy would be doing just fine.
TBTF! The government needs to bail them out!
The muffins were always good, but you could tell they wre in trouble when for the last two years, they’ve been offering an ongoing “deal” on muffins..”BUY 3..get 3 more FREE...that’s cheaper than Dunkin Donuts..
They are way over priced. I bought three milks and three plain waffles with nothing else added for my family and it was over $35 bucks. When they handed my the bill, I thought they were joking.
I happen to like Perkins.
Marie Callendar ping
The vendors demand COD. I've seen it done years ago in the restaurant business.
I hear that Tiger Woods loves Perkins.
We have two Perkins restaurants withing fifteen miles of my home. I have found three things on their menu which the preparers do really well, so I stick to those. Their triple decker turkey club sandwich on whole wheat with fries is my favorite. Both outlets do a superb job on that item.
Loved their banana cream pies.
With the exception of their fresh strawberry pie (only two weeks a year), the food quality has gone down hill to below ordinary.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.