|
 The chain, known for pioneering the concept of toasted subs, said
the restructuring would cut its debt by more than $400 million. It
listed liabilities of between $500 million and $1 billion in its
bankruptcy petition.
All except seven of its nearly 2,100 restaurants are independently
owned and operated by franchisees and will not be affected by the
bankruptcy, the company said in a statement.
"Our business plan includes several key elements aimed at supporting
our franchisees, including reducing food costs, implementing a
franchise owner rebate program," Quiznos Chief Executive Stuart
Mathis said.
The company has received $15 million in debtor-in-possession
financing from its senior lenders in order to keep functioning
during its restructuring period.
Quiznos has been facing stiff competition from its biggest rival
Subway, one of the largest fast-food chain in the world with over
41,000 franchised stores in about 100 countries.
The company also faces competition from newer entrants such as
Potbelly Corp <PBPB.O>, whose low-priced menus have appealed to
consumers in a tough economy.
[to top of second column] |
Struggling pizza chain Sbarro LLC also filed for its second
bankruptcy in three years earlier this week, after struggling with
fewer customers in malls that house many of its restaurants.
A pre-packaged bankruptcy is when an entity negotiates a deal with
creditors and other interested parties in advance and presents that
to a bankruptcy court judge. Pre-packaged plans greatly reduce
uncertainty and legal fees.
The case is In re: The Quiznos Global LLC, U.S. Bankruptcy Court,
District of Delaware, No.14-10557.
(Reporting by Tanya Agrawal in
Bangalore; editing by Saumyadeb Chakrabarty)
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