Consumer Confidential: Pie chain goes bankrupt, Timberland bought, Arby's sold
--Some bitter-tasting pie: Restaurant owner Perkins & Marie Callender's has filed for bankruptcy protection, brought down by tough competition, the weak economy and rising food costs. The owner of the Perkins Restaurant & Bakery and Marie Callender's chains says it plans to close 65 stores and cut 2,500 jobs, or about 20% of its work force of 12,350. The company cites the weak economic climate, particularly in California and Florida, where many of its restaurants are located, for the bankruptcy filing. Documents filed with the U.S. Bankruptcy Court in Delaware indicate the company can't afford to build new restaurants and upgrade existing ones, so it loses traffic to better-funded rivals. The two chains were "adversely affected by the languishing economy, including declines in consumer confidence and sluggish consumer spending and increased commodity costs," CEO J. Trungale said in a statement in November.
--Timberland has a new daddy. The purveyor of outdoorsy shoes and duds is being acquired by VF Corp., whose brands include Wrangler denim and Nautica apparel, for about $2 billion. Eric Wiseman, chairman and CEO of Greensboro, N.C.-based VF, calls the acquisition "transformative." VF's outdoor and action-sports businesses will now comprise 50% of total revenue and are expected to hit 60% by fiscal 2015, Wiseman says. The company's other brands include 7 For All Mankind premium denim, John Varvatos men's clothing and Reef surf gear. Its outdoor and active brands include Vans, Lee and North Face, and the company says Timberland will be complementary to, rather than competitive with, those names. I've always liked Timberland's gear. If only it weren't so darned expensive.
--Adios, Arby's. Wendy's/Arby's Group says it will sell a controlling stake in its Arby’s restaurant chain to Roark Capital Group for $130 million. Atlanta-based Roark will also assume $190 million in debt with the acquisition. Arby’s, which has has 3,600 outlets across the United States, will now focus on new menu items, new breakfast fare and new-look restaurants. Roark specializes in brand management of restaurant companies. The group also has stakes in Atkins Nutritionals, Auntie Anne’s, Cinnabon and Moe’s Southwest Grill. Last month, California Pizza Kitchen agreed to a $470-million buyout by Golden Gate Capital, and groups are reportedly circling Sbarro, the recently bankrupt pizza chain.
-- David Lazarus
Photo: Pie maker Marie Callender's has filed for bankruptcy protection. Credit: Allen J. Schaben / Los Angeles Times