Trouble in toasted sandwich land.
Denver-based Quiznos, whose original store is less than two blocks away from me, is filing its second major financial restructuring in two years. The once thriving sub sandwich shop chain is struggling with debt and several store closures.
According to a Denver Post story, which also quotes The Wall Street Journal, “a debt restructuring or bankruptcy filing has been expected and it’s inevitable,” Restaurant Finance Monitor editor Jonathan Maze said. “The business model just does not work. Sales are falling and franchisees are struggling mightily.”
“The chain reportedly has defaulted on its debt and has been negotiating for weeks with creditors.
Citing unnamed sources, the WSJ reports Quiznos and a consortium of creditors are in the process of creating a so-called prepackaged bankruptcy that would restructure Quiznos’ $570 million in debt.
Quiznos operated about 5,000 restaurants at its peak in 2008 but the count since has dropped to an estimated 2,100.
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