Potential Shoney’s Buyer Wants Out Of Deal

Biz Journals:

The sale of Nashville-based Shoney’s Restaurants is in jeopardy.

Brentwood-based Centrum Equities filed suit Sept. 5 in Davidson County Chancery Court, accusing Shoney’s LLC of breaching the companies’ July 17 asset purchase agreement. That agreement called for Centrum to acquire the restaurant company, including its franchisor rights to 237 restaurants and 54 company-operated locations.

Centrum sent notice on Aug. 30 it was canceling the purchase agreement, a move Shoney’s challenged, leading Centrum to sue. In its notice, Centrum claims Shoney’s is seeking other suitors, and it wants back its $1.5 million earnest money deposit, plus legal expenses. The deal was expected to close this month.

According to the lawsuit, Centrum found there were several health code violations at Shoney’s restaurants, such as the use of equipment not appropriate for storing food.