PBGC Rips Sun Capital Bid To Nab Friendly's Out Of Ch. 11

Law360, New York (December 6, 2011, 12:00 AM EST) -- The Pension Benefit Guaranty Corp. on Monday blasted Sun Capital Partners Inc.’s plan to snag Friendly Ice Cream Corp. out of bankruptcy, saying the private equity firm could not credit bid for the restaurant chain while shirking $105 million in obligations to Friendly's retirees.

Sun Capital’s $267 million subordinated note claim is flawed in several respects and no portion of it should be allowed in the bid, the PBGC said in an objection lodged in Delaware bankruptcy court.

The private equity firm, which is also the...
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