Posts Tagged ‘Friendly’s
Friendly’s, Burger King Join Forces
- Associated Press
Finally, you can have your Friendly’s ice cream—and eat your Burger King fries, too.
The company known for its Fribbles and sundaes is on to a new venture after emerging from bankruptcy protection earlier this month. With 100 of its full-scale eateries shuttered during the Chapter 11 proceedings, it’s trying on a new format for size: a 200-square-foot counter space in a New Jersey burger king, according to the Boston Globe.
The location, known as “Friendly’s Scoop,” is the brainchild of Joe Anghelone, a Burger King franchisee hoping customers might want a sweet treat to go with that Whopper. So far, so good, Anghelone told the newspaper, noting that sales of the ice cream now account for 18% of total sales—beating his projections and giving him hope that the venture could bring in even more money when the weather warms.
Jealous that the Garden State gets to enjoy the two brands’ food in seamless harmony? You might soon be able to indulge in the hybrid concept; plans are in the works for 10 more of the shops over the next year, Friendly’s said.
As the company does away with many of its traditional spots—it closed 37 earlier this month as its bankruptcy proceedings drew to a close, leaving it with about 380 locations total—it’s looking for ways to breathe new life into the chain.
“Friendly’s Scoop” could potentially be the way forward. The start-up costs for “Friendly’s Scoop” are much lower than the restaurant’s full-service locations, which are usually around 2,500 square feet, and they’re a way to reach new customers, Ron Paul, president of Chicago market research firm Technomic Inc., told the Globe.
Of course, Friendly’s isn’t the first company to stumble upon the concept of fast-food marriages. Baskin Robbins can frequently be spotted shacking up with Dunkin’ Donuts at their joint locations and Yum! Brands Taco Bell, KFC and Pizza Hut brands often get cozy at combo spots.
Friendly’s CEO, Sun Capital Ring Up Hefty Expense Tabs
- Getty Images
Harsha Agadi, the fast-food veteran who signed on to lead Friendly Ice Cream Corp. last year, billed the failing company $ 243,000 for expenses in the year before it filed for bankruptcy, court records show.
That’s in addition to nearly $ 190,000 worth of relocation expenses on top of the chief executive’s regular pay—a monthly salary of more than $ 50,000. And it’s aside from a $ 44,000 loan from Friendly’s to a company controlled by Agadi.
Court records don’t detail what sort of expense was reimbursed to the chairman and chief executive of the chain.
In a statement, Friendly’s said the $ 243,000 was “for Mr. Agadi’s business-related expenses such as travel and a franchise convention in Baltimore.”
As for the loan, it’s reimbursement for taxes Agadi paid on interest he was supposed to collect as an investor in Friendly’s, according to the statement released through Friendly’s spokeswoman Maura Tobias. Due to the company’s financial situation, the interest payments were deferred but had to be recognized for tax purposes, the company said. Friendly’s loaned his company the money to pay the taxes.
Once Agadi receives the interest Friendly’s owes him on his investment, he will repay the loan “in full,” the company’s statement said. That might not happen soon, given Friendly’s continued hard-luck status. Equity stake holders get nothing unless creditors are paid in full.
Creditors are up in arms over a case that is shaping into a rout for ordinary suppliers and employees, with sudden job losses topping 1,000 and pensions on the line.
Besides a wave of pink slips and store closings, Friendly’s bankruptcy means a fast trip to an auction, with current owner Sun Capital Partners in the lead on the inside track. Sun Capital has offered to buy Friendly’s again by canceling out senior debt—including the debt Friendly’s owes Sun.
Or allegedly owes Sun, as the Pension Benefit Guaranty Corp., the quasi-governmental insurer of pensions, would have it. PBGC says there are big questions about the validity of Sun’s claim that secured loans it made to a company it owns are as good as cash at the Chapter 11 auction table.
“It is clear to the committee that Sun Capital, if left unchecked, will exert its formidable influence over the debtors to seize all of the value inherent in these estates for itself at the expense of other stakeholders and the integrity and fairness that the Chapter 11 process is designed to protect,” attorneys for the official committee of unsecured creditors have said in court papers.
The Boca Raton, Fla., private equity firm, which hired Agadi in August of last year, took $ 1.5 million worth of management fees out of the company in 12 months before it went under, court records show. Sun also collected some hefty expense reimbursements from Friendly’s, a total of more than $ 88,000 in the year before the bankruptcy.
A Sun Capital spokeswoman declined to comment on the private equity firm’s expense billings.