Friendly Ice Cream Corporation To Be Acquired by an Affiliate of Sun Capital Partners for $15.50 per Share in Cash

Jun 17, 2007, 01:00 ET from Friendly Ice Cream Corporation

    WILBRAHAM, Mass., June 17 /PRNewswire-FirstCall/ -- Friendly Ice Cream
 Corporation (Amex:   FRN) today announced that it has entered into a
 definitive agreement under which it will be acquired by Freeze Operations
 Holding Corp, an affiliate of Sun Capital Partners, Inc., in an all-cash
 transaction for $15.50 per share for a total consideration of approximately
 $337.2 million. The transaction has no financing contingency. The purchase
 price represents an 8.2% premium over the closing price of Friendly's
 common stock on June 15, 2007 and a 30.9% premium over the closing price on
 March 6, 2007, which was the day before the Company announced it was
 exploring strategic alternatives.
     George Condos, President and Chief Executive Officer of Friendly's,
 said, "We believe this transaction delivers very attractive value to our
 shareholders, and it does so more quickly and with greater certainty than
 other alternatives we examined. Every day our management team and employees
 work hard to provide the best dining experience for our guests. I am
 pleased to say that our new investors share this passion and we look
 forward to working closely with Sun Capital Partners on a smooth transition
 for our franchisees, customers and employees."
     Gary Talarico, Managing Director of Sun Capital Partners, said,
 "Friendly's is an iconic brand name in the family restaurant sector and we
 are excited to add this great franchise to our portfolio of restaurant
 investments. We look forward to working with management to build on the
 legacy of this great brand and reinvigorate and expand the company within
 and beyond their historical markets."
     The transaction has been unanimously approved by the Company's Board of
 Directors, which will recommend that Friendly's shareholders approve the
 transaction. Certain Friendly's shareholders including Donald N. Smith,
 Friendly's Chairman of the Board, The Lion Fund L.P. and Biglari Capital
 Corp. and S. Prestley Blake, who collectively own in excess of 50% of the
 Company's shares, have entered into an agreement to vote in favor of the
 transaction. The transaction requires the affirmative vote of 66 - 2/3% of
 the outstanding Company shares and is subject to certain other customary
 closing conditions. The transaction is expected to close during the third
 quarter of 2007. The exact timing of the closing of the transaction is
 dependent on the review and clearance of necessary filings with the
 Securities and Exchange Commission and other governmental authorities.
     Goldman Sachs & Co. acted as the financial advisor to Friendly's, and
 Weil, Gotshal & Manges LLP provided legal advice. Morgan, Lewis & Bockius
 LLP acted as legal counsel to Sun Capital.
     ABOUT FRIENDLY'S
     Friendly Ice Cream Corporation is a vertically integrated restaurant
 company serving signature sandwiches, entrees and ice cream desserts in a
 friendly, family environment in 515 company and franchised restaurants
 throughout the Northeast. The Company also manufactures ice cream, which is
 distributed through more than 4,000 supermarkets and other retail
 locations. With a 72-year operating history, Friendly's enjoys strong brand
 recognition and is currently remodeling its restaurants and introducing new
 products to grow its customer base. Additional information on Friendly Ice
 Cream Corporation can be found on the Company's website
 (www.friendlys.com).
     About Sun Capital Partners, Inc.
     Sun Capital Partners, Inc. is a leading private investment firm focused
 on leveraged buyouts, equity, debt, and other investments in market-leading
 companies that can benefit from its in-house operating professionals and
 experience. Sun Capital affiliates have invested in and managed more than
 155 companies worldwide with combined sales in excess of $35.0 billion
 since Sun Capital's inception in 1995. Sun Capital has offices in Boca
 Raton, Los Angeles, and New York, as well as affiliates with offices in
 London, Tokyo, and Shenzhen. For more information, please visit
 www.SunCapPart.com.
     IMPORTANT INFORMATION
     Statements contained in this release that are not historical facts and
 constitute "forward looking statements" as that term is defined in the
 Private Securities Litigation Reform Act of 1995. These statements include
 statements relating to the anticipated impact, benefits and results of the
 potential acquisition. Risks and uncertainties regarding the transaction
 include the possibility that the closing does not occur, or is delayed,
 either due to the failure of closing conditions, including approval of the
 shareholders of the Company, the failure to obtain required regulatory
 approvals or other reasons. Other factors that may cause actual results to
 differ from the forward looking statements contained herein and that may
 affect the Company's prospects in general are included in the Company's
 other filings with the Securities and Exchange Commission. The Company
 expressly disclaims any obligation or undertaking to release publicly any
 updates or revisions to any such forward looking statement to reflect any
 change in its expectations or any change in events, conditions or
 circumstances on which any such statement is based.
     This document may be deemed to be solicitation material in respect of
 the proposed transaction. In connection with the proposed transaction, the
 Company will file with, or furnish to, the SEC all relevant materials,
 including a proxy statement on Schedule 14A. SECURITY HOLDERS OF THE
 COMPANY ARE URGED TO READ ALL RELEVANT DOCUMENTS FILED WITH OR FURNISHED TO
 THE SEC, INCLUDING THE COMPANY'S PROXY STATEMENT WHEN IT BECOMES AVAILABLE,
 BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED
 TRANSACTION. The final proxy statement will be mailed to stockholders of
 the Company. Investors and security holders will be able to obtain the
 documents free of charge from the SEC's website, www.sec.gov, and from the
 Company's website, www.friendly.com. The Company and its directors and
 executive officers and other members of management and employees may be
 deemed to participate in the solicitation of proxies in respect of the
 proposed transaction. Information regarding the Company's directors and
 executive officers is available in the Company's proxy statement for its
 2006 annual meeting of stockholders, which was filed with the SEC on April
 7, 2006, and in the Company's Annual Report on Form 10-K for the period
 ended December 31, 2006, which was filed with the SEC on March 6, 2007.
 Additional information regarding the interests of such potential
 participants will be included in the proxy statement and the other relevant
 documents filed with, or furnished to, the SEC when they become available."
 
 

SOURCE Friendly Ice Cream Corporation
    WILBRAHAM, Mass., June 17 /PRNewswire-FirstCall/ -- Friendly Ice Cream
 Corporation (Amex:   FRN) today announced that it has entered into a
 definitive agreement under which it will be acquired by Freeze Operations
 Holding Corp, an affiliate of Sun Capital Partners, Inc., in an all-cash
 transaction for $15.50 per share for a total consideration of approximately
 $337.2 million. The transaction has no financing contingency. The purchase
 price represents an 8.2% premium over the closing price of Friendly's
 common stock on June 15, 2007 and a 30.9% premium over the closing price on
 March 6, 2007, which was the day before the Company announced it was
 exploring strategic alternatives.
     George Condos, President and Chief Executive Officer of Friendly's,
 said, "We believe this transaction delivers very attractive value to our
 shareholders, and it does so more quickly and with greater certainty than
 other alternatives we examined. Every day our management team and employees
 work hard to provide the best dining experience for our guests. I am
 pleased to say that our new investors share this passion and we look
 forward to working closely with Sun Capital Partners on a smooth transition
 for our franchisees, customers and employees."
     Gary Talarico, Managing Director of Sun Capital Partners, said,
 "Friendly's is an iconic brand name in the family restaurant sector and we
 are excited to add this great franchise to our portfolio of restaurant
 investments. We look forward to working with management to build on the
 legacy of this great brand and reinvigorate and expand the company within
 and beyond their historical markets."
     The transaction has been unanimously approved by the Company's Board of
 Directors, which will recommend that Friendly's shareholders approve the
 transaction. Certain Friendly's shareholders including Donald N. Smith,
 Friendly's Chairman of the Board, The Lion Fund L.P. and Biglari Capital
 Corp. and S. Prestley Blake, who collectively own in excess of 50% of the
 Company's shares, have entered into an agreement to vote in favor of the
 transaction. The transaction requires the affirmative vote of 66 - 2/3% of
 the outstanding Company shares and is subject to certain other customary
 closing conditions. The transaction is expected to close during the third
 quarter of 2007. The exact timing of the closing of the transaction is
 dependent on the review and clearance of necessary filings with the
 Securities and Exchange Commission and other governmental authorities.
     Goldman Sachs & Co. acted as the financial advisor to Friendly's, and
 Weil, Gotshal & Manges LLP provided legal advice. Morgan, Lewis & Bockius
 LLP acted as legal counsel to Sun Capital.
     ABOUT FRIENDLY'S
     Friendly Ice Cream Corporation is a vertically integrated restaurant
 company serving signature sandwiches, entrees and ice cream desserts in a
 friendly, family environment in 515 company and franchised restaurants
 throughout the Northeast. The Company also manufactures ice cream, which is
 distributed through more than 4,000 supermarkets and other retail
 locations. With a 72-year operating history, Friendly's enjoys strong brand
 recognition and is currently remodeling its restaurants and introducing new
 products to grow its customer base. Additional information on Friendly Ice
 Cream Corporation can be found on the Company's website
 (www.friendlys.com).
     About Sun Capital Partners, Inc.
     Sun Capital Partners, Inc. is a leading private investment firm focused
 on leveraged buyouts, equity, debt, and other investments in market-leading
 companies that can benefit from its in-house operating professionals and
 experience. Sun Capital affiliates have invested in and managed more than
 155 companies worldwide with combined sales in excess of $35.0 billion
 since Sun Capital's inception in 1995. Sun Capital has offices in Boca
 Raton, Los Angeles, and New York, as well as affiliates with offices in
 London, Tokyo, and Shenzhen. For more information, please visit
 www.SunCapPart.com.
     IMPORTANT INFORMATION
     Statements contained in this release that are not historical facts and
 constitute "forward looking statements" as that term is defined in the
 Private Securities Litigation Reform Act of 1995. These statements include
 statements relating to the anticipated impact, benefits and results of the
 potential acquisition. Risks and uncertainties regarding the transaction
 include the possibility that the closing does not occur, or is delayed,
 either due to the failure of closing conditions, including approval of the
 shareholders of the Company, the failure to obtain required regulatory
 approvals or other reasons. Other factors that may cause actual results to
 differ from the forward looking statements contained herein and that may
 affect the Company's prospects in general are included in the Company's
 other filings with the Securities and Exchange Commission. The Company
 expressly disclaims any obligation or undertaking to release publicly any
 updates or revisions to any such forward looking statement to reflect any
 change in its expectations or any change in events, conditions or
 circumstances on which any such statement is based.
     This document may be deemed to be solicitation material in respect of
 the proposed transaction. In connection with the proposed transaction, the
 Company will file with, or furnish to, the SEC all relevant materials,
 including a proxy statement on Schedule 14A. SECURITY HOLDERS OF THE
 COMPANY ARE URGED TO READ ALL RELEVANT DOCUMENTS FILED WITH OR FURNISHED TO
 THE SEC, INCLUDING THE COMPANY'S PROXY STATEMENT WHEN IT BECOMES AVAILABLE,
 BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED
 TRANSACTION. The final proxy statement will be mailed to stockholders of
 the Company. Investors and security holders will be able to obtain the
 documents free of charge from the SEC's website, www.sec.gov, and from the
 Company's website, www.friendly.com. The Company and its directors and
 executive officers and other members of management and employees may be
 deemed to participate in the solicitation of proxies in respect of the
 proposed transaction. Information regarding the Company's directors and
 executive officers is available in the Company's proxy statement for its
 2006 annual meeting of stockholders, which was filed with the SEC on April
 7, 2006, and in the Company's Annual Report on Form 10-K for the period
 ended December 31, 2006, which was filed with the SEC on March 6, 2007.
 Additional information regarding the interests of such potential
 participants will be included in the proxy statement and the other relevant
 documents filed with, or furnished to, the SEC when they become available."
 
 SOURCE Friendly Ice Cream Corporation