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Bankruptcy Court frees up A&P financing
The U.S. Bankruptcy Court for the Southern District of New York has approved A&P’s First Day Motions, including granting immediate access to $50 million of the $100 million debtor-in-possession financing provided by Fortress Investment Group.
July 21, 2015
2 Min Read
The U.S. Bankruptcy Court for the Southern District of New York has approved A&P’s First Day Motions, including granting immediate access to $50 million of the $100 million debtor-in-possession financing provided by Fortress Investment Group. This will enable A&P to continue operating its stores and pay its suppliers, vendors, employees and others in the ordinary course of business.
The development comes after A&P executed asset purchase agreements to sell approximately 120 stores, and close 25 stores in the near-term due to lack of interest and operating losses.
All asset and store sales will be conducted through a court-supervised sale process which could include a possible credit bid for certain assets to be purchased by A&P’s current investors.
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“We are pleased that the Court has granted these motions promptly, which allows us to continue operating in ordinary course during this process — continuing to pay employees, work with suppliers and serve customers,” said Paul Hertz, president and CEO of Montvale, N.J.-based A&P, in a statement.
“We are confident that pursuing a sale process implemented through chapter 11 will enable us to preserve as many jobs as possible and ensure that we achieve the best possible outcome for all stakeholders. I want to thank our employees for their hard work and commitment to our company, as well as our suppliers for their help in guaranteeing that our stores are fully stocked and that we are able to continue meeting the needs of our customers and their families without interruption."
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