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US alleges fraud in Friendly’s case

Officials say owner Sun Capital hid pension assets to maintain control

The Friendly’s restaurant chain filed for Chapter 11 in October and closed more than 60 stores and laid off about 1,200 workers, half of them in Massachusetts. The ice cream chain said it was a victim of a tough economy. The Friendly’s restaurant chain filed for Chapter 11 in October and closed more than 60 stores and laid off about 1,200 workers, half of them in Massachusetts. The ice cream chain said it was a victim of a tough economy. (Photos by Jonathan Wiggs/Globe Staff)
By Jenn Abelson
Globe Staff / December 13, 2011
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A federal agency that insures company pension plans is accusing Sun Capital Partners, the owner of Friendly’s Ice Cream Corp, of fraudulently moving assets so that its affiliates could retain control of the Wilbraham business and avoid paying retirement benefits to nearly 6,000 workers and retirees. Sun Capital Partners, a Florida private equity firm, illegally transferred assets from the ice cream chain and its parent company responsible for the pension plans to another Sun affiliate weeks before the October bankruptcy filing.

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