Grocery Store Chain A&P Files for Bankruptcy Again

6/15/2016 Grocery store chain A&P files for bankruptcy again

Grocery store chain A&P files for bankruptcy again

Customers push grocery carts outside of a Pathmark store, a subsidiary of The Great Atlantic & Pacific Tea Company in New York March 5, 2007.

Reuters/Lucas Jackson Storied supermarket chain Great Atlantic & Pacific Tea Co Inc [GRTAT.UL], better known as A&P, filed for bankruptcy protection for the second time in five years and said it would sell more than a third of its stores. The 156yearold company, which also owns Best Cellars, Pathmark and Superfresh stores, has been squeezed by discounters such as WalMart Stores Inc (WMT.N) and upmarket grocery chains such as Whole Foods Market Inc (WFM.O).

New entrants Sprouts Farmers Market Inc (SFM.O) and Fresh Market Inc TFM.O have also eaten into the chain's business.

In its heyday in the early 20th century, A&P operated more than 15,000 stores. It first filed for bankruptcy in 2010, reemerging two years later as a private company after obtaining financing from investors including Goldman Sachs and an affiliate of billionaire Ron Burkle.

A&P, which now has 296 stores, listed assets and liabilities each of more than $1 billion in its Chapter 11 filing late Sunday. The company was considering a bankruptcy filing among options to cut costs, Bloomberg reported last month.

A&P said in a statement on Monday it was selling about 120 stores for about $600 million. It did not name the http://www.reuters.com/article/usgreatatlanticbankruptcyidUSKCN0PU08F20150720 1/2 6/15/2016 Grocery store chain A&P files for bankruptcy again buyers. It is also closing 25 stores due to lack of interest and significant operating losses.

In court documents filed late on Sunday, the company said it was in talks with Acme Markets Inc, owner of Safeway and Albertsons grocery stores, Shop & Stop Supermarket Co LLC and Key Food Stores Cooperative Inc to sell its assets.

Doubledigit declines in samestore sales over the last two years, debt and a backlog of investment across A&P's operation had made the business untenable, said Neil Saunders, who runs retail research firm Conlumino.

A&P has hired Evercore Partners, an investment bank that specializes in selling assets.

The company has received debtorinpossession financing of $100 million from Fortress Credit Corp, court documents showed.

The Montvale, New Jerseybased company employs about 34,000, according to its website.

The company was founded as a mail order business in 1859 by tea and spice merchants George Huntington Hartford and George Gilman. In the same year, it opened its first storewarehouse operation in New York City, according to A&P's website.

The case is in U.S. Bankruptcy Court, Southern District of New York, Case No: 1523007.

(Reporting by Supriya Kurane and Yashaswini Swamynathan in Bengaluru; Editing by Anupama Dwivedi and Joyjeet Das)