HUFFINGTON POST
11/29/2011 04:49 pm ET Updated Nov 29, 2011

Sbarro Bankruptcy Proceedings Over As Pizza Chain Exits Chapter 11 With Less Debt

Sbarro will live to fight another day. The Melville, N.Y.-based pizza and pasta chain, exited bankruptcy status today, according to Nation's Restaurant News.

Sbarro first filed for Chapter 11 protection in April, citing high ingredient costs and shrinking sales. Reports from earlier this autumn, though, indicated that the company planned to ends its proceedings before the new year.

The chain won court approval for its bankruptcy plan on November 17th, indicating that the end of its struggles was at a close, at least for now.

Nicholas McGrane, Sbarro's interim president, told NRN, "Our reorganization plan eliminates more than 70 percent of our debt, and provides access to $35 million in fresh capital from our new ownership group." The company was bought by private equity firm MidOcean Partners in 2007.

Sbarro's departure from bankruptcy bodes well for the future of the 1000-strong global chain, but it did not emerge unscathed from the proceedings. Twenty-five of its company-owned -- as opposed to franchised -- locations have closed since April.

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