Quiznos is making a triumphant comeback after filing Chapter 11 bankruptcy in March, 2014. Through filing bankruptcy and radically restructuring their finances, the company was able to pull themselves out of $400 million of debt.
Restructuring Their Finances
Since March, the sub-sandwich company has been under Chapter 11 bankruptcy protection. On May 12, however, a federal bankruptcy court gave the company positive reinforcement on their financial reorganization plan.
Through the advice of expert bankruptcy lawyers, this debt-decreasing plan involved three of the top figures in the company forming an agreement to trade $445 million in debt for $200 million in new debt plus 70% of the company’s shares. While Quiznos is not yet debt free, this reduction is remarkable — especially considering the short amount of time it took for the company to organize this level of financial restructuring.
The choice to file under Chapter 11 also provided the sandwich chain to have flexibility concerning leases and various contracts.
Quiznos CEO Stuart Mathis said, “With our financial restructuring behind us now, we have a strong foundation to execute our comprehensive plan to strengthen performance, revitalize the Quiznos brand, and reinforce its promise as a fresh, high-quality, and great tasting alternative to traditional fast food offerings.”
Like many other individuals and businesses, Quiznos took a hard hit financially during the recession, which eventually led them to declare bankruptcy. This decision will continue to lend positive benefits to the company.
In addition to restructuring their finances, Quiznos has made other cost-cutting efforts to save their business. They moved their headquarters out of a swanky downtown Denver office tower to the more humble Denver Tech Center.