After a rough day in the 'burbs, nothing turns that frown upside down faster than a Turkey Club SuperMelt® sandwich at Friendly's, followed by one of their signature "Happy Endings." But in today's economy, nobody can afford to end happily at Friendly's, and the long-running restaurant/ice cream chain is in deep trouble. Like the rest of America, Friendly's is drowning in debt.
The company could file for Chapter 11 bankruptcy as early as next week, the Wall Street Journal reports (paywall). Friendly's, which was acquired by investment firm Sun Capital Partners (they own Boston Market) in 2007 for $337.2 million, already owes $30 million to Wells Fargo. Now, like a clumsy child who drops his ice cream cone in the parking lot, Friendly's is crying for more: The company wants another $70 million in financing to stay afloat... so it can go bankrupt and get sold to somebody else.
All told, Friendly's carries more than $250 million in debt. The moribund economy coupled with rising food costs have reportedly cost the company dearly, and not even a new High 5 menu—featuring the restaurant’s five most popular items for just $5—seems to be enough to bring it back from the brink. In a way, things are coming full circle: S. Prestley Blake and his brother Curtis opened the first Friendly's in Springfield Massachusetts during the Great Depression. Now the Great Recession is dragging them under.
Blake, now 96, no longer has a stake in the company (which has not confirmed it's filing for bankruptcy). But reached for comment, Blake tells MassLive.com, "They have so much debt, I don’t know how they thought they would carry all that debt." Friendly's now employs 10,000 people, down from 12,000 two years go. It has 500 locations nationwide, including one on Staten Island, just in case this news has you craving one of their magnificent Reeses Pieces Peanut Butter Cup Sundaes. Sure, it's high in calories, but you can easily work those off with a robust fight on the ferry home.