A&P Selling 120 Stores in $600 Million Deal, Files for Bankruptcy Protection
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- Advertisement - A&P selling 120 stores in $600 million deal, files for bankruptcy protection July 20, 2015 The Great Atlantic & Pacific Tea Co. Inc. has filed for chapter 11 bankruptcy protection for the second time in five years. With 25 stores closing and approximately 120 being sold for $600 million, A&P will be losing nearly half of its current 296 stores. Ahold's Stop & Shop division will acquire 25 of the A&P stores in Greater New York for $146 million. The transaction is expected to close in the second half of 2015. At one time A&P, which operates in six states under the brand names A&P, Best Cellars, Food Basics, The Food Emporium, Pathmark, Superfresh and Waldbaum's, was the largest U.S. 1 / 2 supermarket chain with more than 15,000 stores. “After careful consideration of all alternatives, we have concluded that a sale process implemented through chapter 11 is the best way for A&P to preserve as many jobs as possible, and maximize value for all stakeholders,” Paul Hertz, president and chief executive officer of A&P, said in a press release. “The interest from other strategic operators has been robust during the company’s sales process to date, and we have every expectation that will continue in chapter 11. And while the decision to close some stores is always difficult, these actions will enable the company to refocus its efforts to ensure the vast majority of A&P stores continue operating under new owners as a result of the court-supervised process. We greatly appreciate the continued support of our customers, suppliers and employees, who have maintained an unwavering commitment to our business and our customers.” The company also announced that it is seeking court approval to enter into a $100 million debtor-in- possession financing agreement with Fortress Investment Group. A hearing to approve the DIP facility was scheduled for July 20. Upon approval, this facility will enable A&P to continue operating its stores, pay its suppliers, vendors, employees and others in the ordinary course of business. All asset and store sales will be conducted through a court-supervised sale process, subject to court approval and certain other conditions. The sale process could include a possible credit bid for certain assets to be purchased by A&P’s current investors. A&P said it will continue to conduct business and serve customers at its stores during the court- supervised sale process. The open stores will remain fully stocked with a complete range of products, and all existing customer promotional and loyalty programs will stay in place during this process. Print Powered by TCPDF (www.tcpdf.org) 2 / 2.