The Montvale, New Jersey-based company listed assets and debt of more than $1 billion each in its bankruptcy filing.
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The grocer has received debtor-in-possession financing of $100 million from Fortress Credit Corp, court documents show.
Coming on the heels of A&P’s bankruptcy filing is an announcement that Stop & Shop Supermarket Company LLC will acquire 25 New York-based A&P stores – including the Pathmark at 1351 Forest Ave., Port Richmond – for $146 million.
The company has bidders for at least 120 stores it wants to sell for approximately $600 million. The agreement will allow the stores to continue day-to-day operations. A&P has decided, however, that it will close 25 stores in the near-term due to lack of interest and significant ongoing store operating losses.
“Now with 253 stores (including Fresh Grocer), ShopRite rang up estimated sales of $13.73 billion or 14.41% of the entire $95.3 billion Food Trade News’ marketing area [a 70-county area from Connecticut to Delaware]”. The company, which is the owner as well of Pathmark, Superfresh and Best Cellars stores, had not be able to stand up to the behemoths in the industry such as Costco Wholesale and Walmart Stores, who attract customers with large discounts.
This isn’t the first time the grocery chain has entered bankruptcy: A&P filed for chapter 11 in 2010 and emerged two years later.
The company said that, if approved, the DIP financing will enable A&P to continue operating stores, pay its suppliers and vendors, and make payroll for employees.
‘Our message to any potential buyers of A&P is that our hard-working members are not just employees, they are the heart and soul of these stores, ‘ UFCW said in a statement.
While Wegmans of Gates, New York ranked No. 1, Pathmark ranked 65, A&P 66 and Waldbaum’s 68.
UFCW represents 72.5 percent of union-represented employees at A&P. A&P plans to seek court approval of the already announced auctions early next month.
The United Food and Commercial Workers global union said, “we expect A&P to do what is right by members and their families”. Today, Acme operates 107 stores, including Sav-On Pharmacies at select locations, in Pennsylvania, New Jersey, Delaware and Maryland, employing more than 11,000 associates.
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Brian Shiver, one of A&P’s press contacts for the announcement, said he could not comment on how the Chapter 11 filing would impact A&P’s role in development in Montclair.
