Sbarro pizza chain planning to file for bankruptcy

April 1st, 2011 - 8:13 pm ICT by Aishwarya Bhatt  

New York, April 1 (THAINDIAN NEWS) Reports on the Internet indicate that Sbarro Inc. is considering filing for bankruptcy. A source cited in the reports say the company missed interest payments on its debt and that has prompted the company to consider bankruptcy protection.

MidOcean Partners acquired Sbarro Inc. in 2007. When the MidOcean acquired the pizza chain, it drew up a plan to restructure the company’s debt. The reports indicate the filing of the bankruptcy protection may come as early as next week.

Wall Street Journal first broke the possibility of Sbarro filing for bankruptcy. Sbarro defaulted on the payment of interest on its debt in February. The company’s third forbearance agreement expires today – 1st of April 2011. Bloomberg reports that Sbarro has about $350 million in bonds and loans. Sbarro was formerly owned by the Sbarro family.

After the company was opened by the Sbarro family about more than half a century ago as a single eatery unit, the company has grown to more than 1,000 fast food joints throughout the United States. The first Sbarro eatery was opened in Brooklyn, New York, according to the information provided on the website of Sbarro.

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