Hot Dog on a Stick is purchased from bankruptcy for $12.2 million

Mall snack staple Hot Dog on a Stick has been purchased from bankruptcy by a portfolio company of Los Angeles private equity firm Levine Leichtman Capital Partners.

The firm’s Global Franchise Group has bought HDOS Enterprises, parent company of the fast-food chain known for hot dogs and lemonade, for about $12.2 million in an auction from Bankruptcy Court, according to a Thursday statement and court documents.

Global Franchise also assumed HDOS’ liabilities.

HDOS filed for Chapter 11 bankruptcy in February after struggling with declining foot traffic in malls and expensive leases.

Chris Dull, chief executive of Global Franchise Group, said Hot Dog on a Stick adds “another strong brand” to the company’s roster of quick service restaurants.

“We can greatly accelerate growth while providing HDOS’ loyal customer base with even greater service and menu offerings,” he said in a statement.

Before filing for bankruptcy protection, Hot Dog on a Stick tried to slash its expenses and cut its workforce.

The years of economic turmoil were hard on the chain, which depends on shoppers who were increasingly reining in their spending. Many shopping centers have also revamped food courts to bring in more healthful fare to accommodate people’s increasingly refined palates.

The company opened its first location in 1946 on the beach in Santa Monica. Founder Dave Barham originally called the store Party Puffs, and later changed the name to Hot Dog on a Stick.

Barham adopted his mother’s cornbread recipe to make its signature snack. The chain’s first mall shop opened in 1973 in Salt Lake City.

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