Piccadilly Restaurants files for bankruptcy

Wed Sep 12, 2012 3:36am EDT

(Reuters) - Piccadilly Restaurants LLC filed for Chapter 11 bankruptcy protection on Friday after debt restructuring talks broke down with its lender, New York-based fund Atalaya Capital Management.

Part of the company's debt was recently purchased by Atalaya, the company said in a statement on Wednesday while not mentioning the size of the debt.

Piccadilly was given a commitment for debtor in possession financing of up to $5 million, providing the company with ample liquidity, the company added.

Baton Rouge, Louisiana-based Piccadilly has about 80 restaurants, over 70 food service operations and has roughly 3,500 employees. Piccadilly provides over 9,000 meals per day to evacuees and serves 30 schools across the U.S. Southeast.

(Reporting by Sunayan Bhattacharjee in Bangalore; Editing by Mark Potter)

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