The company has its sights set on reinvigoration.
Amici Partners Group, LLC has acquired Friendly’s Restaurants, the company announced January 19. It will take on more than 130 corporate-run and franchised locations of the 80-plus-year-old brand.
“The investors of Amici Partners Group, LLC have been involved with the Friendly’s Restaurant brand in many capacities over the years, not only as owners/operators and leaders in the system, but also as longtime loyal customers of this iconic brand,” Craig Erlich, president and CEO of Amici Partners and its affiliated company, BRIX Holdings, LLC, a multi-brand franchising company, said in a statement. “Based on our personal connection to the chain, strong investment capabilities, and seasoned management team, we believe we will be able to continue to reinvigorate this much-loved brand for both loyal patrons and new customers alike.”
Friendly’s, a fine-dining landmark founded in 1935, filed for bankruptcy in early November—the second time it’s done so in nine years. The chain said at the time Chapter 11 would facilitate a roughly $2 million sale to Amici, whose restaurant portfolio includes Red Mango Yogurt Café Smoothie & Juice Bar, Smoothie Factory Juice Bar, RedBrick Pizza Kitchen Café, Orange Leaf, Humble Donut Co., and Souper Salad.
The company has been involved in the quick-service and casual-dining space for more than 25 years.
Chief Restructuring Officer Marc Pfefferle revealed in court filings he advised Friendly’s for more than two years ahead of bankruptcy. During that stretch, the company lost money and routinely borrowed under its credit facilities.
Before COVID-19, Friendly’s hired a firm to market a potential sale and sent teasers to 40 strategic buyers and 76 possible financial buyers. Court documents showed non-disclosure agreements emerged from 11 strategic buyers and 22 financial buyers. In January, five parties indicated interest.
The pandemic stalled negotiations. BRIX Holdings, which designated Amici as the purchaser, submitted a letter of intent to acquire Friendly’s assets once talks resumed.
While the $2 million figure wasn’t termed “substantial” in documents, Pfefferle noted it would allow Friendly’s to save thousands of jobs, protect franchisees, and reduce claims as Amici assumed numerous contracts and a majority of leases.
Roughly two years ago, Friendly’s had 173 restaurants, including 76 company-owned and 97 franchises. It entered bankruptcy with about 50 corporate units and 80 franchises, and appears to have held steady over the past few months.
According to FoodserviceResults, Friendly’s generated $230 million in systemwide sales last year, an 8 percent drop from 2018’s $250 million.
At filing, Friendly’s received a commitment from two secured lenders to waive, release, and discharge $87.88 million worth of secured debt. Senior Lender Sun Ice Cream Finance II, LP advanced advancing up to $7.5 million in cash before the waive, release, and discharge. Other entities agreed to waive and release more than $430,000 in claims, such as deferred rent and management fees.
Going back three decades, Friendly’s had 850 stores. There were 515 total locations when Sun Capital Partners bought the chain for $337.2 million in 2007. Four years later, the restaurant filed for bankruptcy, closing 100 unprofitable stores and clearing $297 million in debt.
“Friendly’s holds a special place in the hearts of its many loyal patrons, and we look forward to nurturing that legacy and creating new programs and menu items to meet the changing needs of our customers,” Erlich said.
Amici said it plans to bring back many of Friendly’s favorites while also focusing on menu innovation, including new ice cream flavors, reestablishing Friendly’s as a family-friendly destination, and delivering an elevated guest experience. Additionally, it plans to enhance Friendly’s app for online ordering, takeout, delivery, and a new loyalty program.