NEW YORK -- The U.S. Bankruptcy Court here has approved $800 million in financing for Winn-Dixie Stores, Jacksonville, Fla. The chain hopes to generate another $15 million this week by selling its corporate jet.
Last week, Winn-Dixie also asked the court to extend the April 22 deadline to assume or reject store leases by 150 days. It said it needed more time to determine which locations would be vital to its business plan. The extension, if granted, would give Winn-Dixie until mid-September to determine the fate of some of its 920 stores.
The company also announced last week that Tom Robbins will be its senior vice president of merchandising. Robbins is a 37-year veteran of the supermarket industry. He most recently served as executive vice president of sales and merchandising for Price Chopper, Schenectady, N.Y. Robbins will help lead the focus on sales and merchandising, which is key to the company's turnaround, said Peter Lynch, Winn-Dixie's chief executive officer.
Robbins, who begins at Winn-Dixie today, began his career in 1967 with Kroger. Subsequently, he held positions in sales and marketing at A&P, and was senior vice president at Thriftway Food & Drug and at Delchamps, where he was instrumental in that chain's turnaround, according to Winn-Dixie. Robbins was with Price Chopper for six years, but left the company about two years ago, a Price Chopper spokeswoman said. "A strong and well-seasoned merchant leading Winn-Dixie's turnaround plan is critical as we work our way through Chapter 11," Lynch said in a statement.
Regarding the sale of its corporate jet, Winn-Dixie revealed in court papers filed last week that it had been seeking a buyer for the aircraft since last October. The retailer considers the effort as a means to cut non-essential costs amid poor sales performance. The court approved its request for an expedited hearing to complete the sale this week, since Winn-Dixie's agreement with the purchaser, McLean, Va.-based real-estate firm Molinaro Kroger, stipulates the sale must be approved by March 30.
According to Winn-Dixie, the sale of the nine-passenger Gulfstream G-200 jet would generate $15.2 million.
The debtor-in-possession financing, led by Wachovia Bank, Charlotte, N.C., and announced concurrent with Winn-Dixie's Chapter 11 filing last month, was approved by the court. Approval was granted despite objections from about 20 vendors that argued the facility may hinder their reclamation claims. According to court papers, more than half the money will be used to repay loans under Winn-Dixie's previous $600 million credit facility, also headed by Wachovia.
In a separate request last week, Winn-Dixie asked the court for a 150-day extension of its deadline to decide upon lease assumptions or rejections. Bankruptcy law allows a Chapter 11 company to exit lease contracts, but sets a deadline 60 days from the petition date. Winn-Dixie said it needed additional time to decide which locations would be vital to its business plan.