U.S. Bankruptcy Court Okays Third Party Assistance to Sell 55 A&P Stores
MONTVALE, NJ - The A&P chain is still standing, but only just. The retailer has just gained U.S. Bankruptcy Court approval to bring a third party to sell the 55 stores that stand between final liquidation.
Lohud Journal reports that A&P has enlisted a joint venture made up of A&G Realty Partners, Tiger Capital Group, SB Capital Group as well as some of A&P's secured creditors, who have agreed to pay the chain $5 million in the form of credit.
The selling is to take place over the next couple of months, with A&P receiving cash payment from any sale the joint venture succeeds in. Those the venture wishes to take over for itself will result in an additional $250,000 for A&P.
While the third party mix has agreed to also pay rent on the 55 stores as they attempt to sell, some stores are not included in the package, like the A&P Patterson location. Though that store is said to have a buyer, it must have court approval, which was not listed at this hearing.
The next scheduled hearing for the chain is slated for January 22nd.
The company has also reached an agreement with union workers. United Food and Commercial Workers lawyer Richard Seltzer told Lohud that there was little time left to negotiate. "We're really at a point where the company as an operating company has come to an end," he said.
The consensus, therefore, is that it will stop paying retiree health benefits and life insurance, in some cases, as early as the end of January.
While A&P has successfully closed all operating stores and is preparing to exit the lease on its headquarters, other hiccups still remain before the company can finish phasing out. For whatever reason, buyers that have previously committed to purchasing locations have not yet closed the deals, for which the retailer's lawyers are reportedly filing with the court to push forward.
It appears, for the moment, A&P will carry its case over to the new year.
We will continue to keep you up to date on the retailer’s progress as it seeks to efficiently bow out of the market.