Industry News | November 3, 2005

Troubled Doughnut-Maker Alters Ownership of Foreign Franchises

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Krispy Kreme Doughnuts Inc. has shed some of its investments in overseas franchises and restructured some of its debt agreements, the company revealed in a complicated filing with the Securities and Exchange Commission Thursday morning. It also agreed to acquire the assets of a bankrupt Canadian franchisee, bizjournals.com reports today.

The company said it has:

Acquired the assets of KremeKo Inc., a Canadian franchisee that declared bankruptcy earlier this year. Krispy Kreme had owned 40 percent of that franchisee when it declared bankruptcy, and had been providing cash to continue its operations as it restructured. Sold its interest in Krispy Kreme Australia Pty Ltd. to Australian investors for 5.1 million Australian dollars. Shed its equity stakes in Amazing Glazed LLC and Amazing Hot Glazers LLC, two Pennsylvania franchisees. The company also announced it was restructuring various debt guarantees and credit agreements it had related to franchises in the United States, Australia, Canada and the United Kingdom.

Separately, the company (NYSE: KKD - News) announced in a news release that a store operated by franchise owner Lincoln Spoor had opened in Missoula, Mont. The store, which will employ 80 people, is Spoor's second in Montana and the 15th in his franchise.

News and information presented in this release has not been corroborated by QSR, Food News Media, or Journalistic, Inc.