The owner of Perkins and Marie Callender restaurant chains filed for bankruptcy on June 13, 2011. Court documents show that the company plans to shutter 65 of its 600 locations and eliminate 2,500 jobs.
The bankruptcy is wiping out the investment of private equity firm Castle Harlan. They acquired the Perkins chain in 2005 for $245 million. Castle Harlan added the Marie Callender Restaurant and Bakery chain in 2006 for $140 million.
The restaurant chain is the latest food business to fall in a sluggish economy and soaring food prices. Perkins and MarieCallender Inc.’s filing follows on the heels of a bankruptcy filed by chicken producer Allen Family Foods.
Company President Joseph Trungale said in court documents that the company was hit hard by a weak economy. A sharp decline in restaurant sales in the Midwest, Florida and California pushed the company into filing.
The company said that high unemployment and foreclosure rates in Florida and California led to a decrease in discretionary income for many historically loyal customer, resulting in a drop in customer traffic.
Total assets for the company listed in the petition are $290 million with liabilities of $440.8 million. Eleven affiliates of Perkins and Marie Callender’s, Inc. are included in the bankruptcy filing.
If you are seeking bankruptcy information , contact a Chicago bankruptcy attorney for insight into how the process works.