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NEW YORK, Oct 22 (Reuters) - The operator of the Ponderosa and Bonanza steakhouse chains filed for Chapter 11 bankruptcy protection on Wednesday, in the latest example of how hard casual dining restaurants are being hit by the economic slowdown.
The steakhouse operator, Metromedia Steakhouses Co LP, said in a statement it has received a commitment of debtor-in-possession financing from an existing creditor.
It plans to operate as usual as it reorganizes around its franchise operations and a profitable core of company-owned restaurants.
Once it obtains approval from the U.S. Bankruptcy Court for the District of Delaware, the steakhouse operator said it will use that financing to help fund its operating expenses.
The company listed assets in the range of $1 million to $10 million and liabilities of $100 million to $500 million in its bankruptcy filing.
Metromedia’s bankruptcy follows that of rival S&A Restaurant Corp., the company behind the Bennigan’s and Steak & Ale chains. Customer traffic at these chain restaurants have declined as cash-strapped U.S. consumers dine out less due to an economic slowdown, job losses and a credit crisis.
The Chapter 11 debtors are being represented by the law firm of Irell & Manella LLP. (Reporting by Martinne Geller and Caroline Humer, editing by Matthew Lewis and Derek Caney)
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