Friendly in sale-leaseback deal for HQ, 160 branches

Nation's Restaurant News,  Oct 29, 2007  

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WILBRAHAM, MASS. -- Friendly Ice Cream Corp. reportedly has sold its headquarters campus and 160 Friendly's restaurant locations, but leased them back under longterm contracts, according to published reports.

The deal, said to be worth about $40 million, centered around the sale of Friendly's Wilbraham headquarters to Escondido, Calif.-based Realty Income Corp. for about $27.5 million.

Friendly executives were quoted as saying the sale-leaseback was part of an overall restructuring of the company's balance sheet and would assist in securing its long-term future.

Friendly owns and operates 316 Friendly's family-dining restaurants and is franchisor of another 196 branches. It was acquired in August by Boca Raton, Fla.-based Sun Capital Partners for $337.2 million. The majority of the stores involved in the sale-leaseback belonged to the franchisor, though a few are franchised outlets.

Neither Friendly nor Sun Capital could be reached for comment by press time.

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