5 Companies You Didn’t Know Filed for Bankruptcy
Do you think bouncing back from bankruptcy is impossible? Think again! It’s not uncommon for formerly bankrupt companies to come back even better than before.
Often, society changes, and it’s up to business owners to stay with the times. Failing to properly pivot at the right time can lead to a financial setback, but filing for bankruptcy has helped hundreds of businesses get back on their feet.
Read on to learn about five surprising companies that have filed for bankruptcy in the past.
1. Marvel Entertainment
Something about superheroes has always captured the attention and hearts of Americans, so it might be a surprise to learn that Marvel Entertainment was forced into bankruptcy in 1996.
Marvel Entertainment was enjoying plenty of profits prior to the ‘90s, but after that time, comic books stopped being popular. By 1996, the company had failed to pivot its business model, so they were struggling to make any profits at all. As a result, the company couldn’t pay back its creditors. The same year, they had to file for a Chapter 11 bankruptcy.
Filing for bankruptcy helped Marvel Entertainment restructure their business model, and it also helped them come up with a great idea. They decided to essentially ‘auction off’ their superhero characters to different film producers. Now, they’ve earned a whopping $15 billion (https://www.thewrap.com/how-marvel-went-from-bankruptcy-to-hollywoods-most-successful-franchise/) in worldwide box office sales alone!
Twinkies have always been a beloved snack, but you might not know that Hostess Brands actually went bankrupt in 2012. Despite making popular snacks like Ho-Hos and Ding Dongs, the company was struggling to pay off the interest on its debts. Over time, the interest became too big to overcome, so Hostess filed for a Chapter 11 bankruptcy.
Initially, consumers were worried that their popular snacks would be off the shelves for good. Thankfully, Metropoulos purchased Hostess Brands in 2013. Within the year, they had Twinkies circulating on the shelves once again.
If you’ve ever been to a shopping mall food court, then you’ve likely seen the delicious, massive pizza slices offered at Sbarro restaurants. Despite being well-recognized and in over 600 shopping malls, Sbarro fell into financial turmoil in 2011. They filed for Chapter 11 bankruptcy and tried to continue. Although their pizza product is great, Sbarro wasn’t able to pivot from shopping mall diners to other types of restaurants. As a result, they had to file for bankruptcy again in 2014. Although they’ve struggled, Sbarro has once again attempted to re-brand itself as a casual pizza place rather than a mall kiosk.
Remember when one of the biggest gas station chains was Texaco? It seemed sudden when all the Texaco stores started to disappear, but the reason why is because the company had to file for bankruptcy after battling with Pennzoil Co for years in court.
Prior to their legal challenges, Texaco Inc. was considered the nation’s third-largest oil company. After a bank ruling said they owed over $10.5 billion in damages to Pennzoil, the company quickly succumbed to financial despair. In 1987, they filed for a Chapter 11 bankruptcy. While the company was in a bad spot, they were able to renegotiate their debts and settle with Pennzoil for $3 billion.
Converse may be a 112-year-old company, but they’ve faced their fair share of financial troubles in the past, too. Converse made a mark when they created the iconic Chuck Taylor sneaker in the ‘80s, but the shoe slowly fell out of popularity. Converse failed to adapt, and they quickly started losing profits. By 2001, the company was struggling so much that they had to file for bankruptcy.
So, what changed between then and now? Now, Converse is a $1.4 billion business (https://qz.com/129238/how-converse-went-from-bankruptcy-to-a-1-4-billion-business/). After struggling in 2001, the company decided to change its canvas sneaker into a literal canvas. Suddenly, the iconic shoe became much more attractive to consumers.
Bankruptcy Isn’t Just for Big Businesses
Big businesses often have legal advisors who know when it’s time to pull the financial plug. Filing for bankruptcy offers a lot of protection for investors or individuals who are tied up with massive loads of debt.
Bankruptcy isn’t just for big businesses, though. Individuals can find protection and advantages through a bankruptcy claim, too. If you currently find yourself underwater on your loans or bogged down in debt, then we can help. Reach out to our bankruptcy attorneys now at (888) 348-2616 to learn more about your options.