Piccadilly says N.Y. firm is attempting ‘hostile takeover’

Piccadilly Restaurants CEO Tom Sandeman says the company’s surprising move to file for bankruptcy late Tuesday was the result of an attempted “hostile takeover” by New York-based Atalaya Capital Management, which acquired the Baton Rouge-based company’s secured debt in April. Sandeman says the company was “totally, unequivocally” caught off guard when debt restructuring talks broke down and Atalaya made moves to appoint a receiver. “We were in negotiations with lenders for a debt equity swap, which would have been very good for the company,” says Sandeman. The suit, filed by Atalaya on Friday, Sept. 7, “would have put us out of business,” says Sandeman. “This is an attempt to take over the company,” he adds. Calls to Atalaya for reaction to Sandeman’s assertions were not returned. Sandeman says Piccadilly filed for Chapter 11 to “protect the brand and continue to serve our customers, including 10,000 evacuees and relief workers” still dealing with Hurricane Isaac’s impact. The company was established in 1944 in Baton Rouge and grew to be one of the most recognizable brands in cafeteria-style comfort food in the South; but after the costly acquisition of Morrison’s Cafeteria and an unfunded pension burden, the company filed for bankruptcy protection in 2004. It was subsequently bought by Los Angeles-based private equity firm Yucaipa Companies, which still owns it today. —Maggie Heyn Richardson