NEWS WATCH: C&S TO CLOSE TWO NEW ENGLAND WAREHOUSES: REPORT...PENN TRAFFIC ASKS COURT TO CANCEL LEASES ON DEPOTS...WORKERS AT STOP & SHOP SCHEDULE STRIKE VOTE 2004-02-16 (1)

C&S TO CLOSE TWO NEW ENGLAND WAREHOUSES: REPORT

re will close two warehouses that it acquired from Supervalu last year, according to local reports. The company reportedly will shutter a 230,000-square-foot facility in Cranston, R.I., and a 450,000-square-foot facility in Andover, Mass. The Cranston site is scheduled to close in April, but it was not clear when the second facility would close. C&S, which operates 10 distribution centers in New England, will supply customers from other existing facilities, the reports said. C&S could not be reached for comment.

PENN TRAFFIC ASKS COURT TO CANCEL LEASES ON DEPOTS

SYRACUSE, N.Y. -- Penn Traffic Co. here said it has asked the U.S. Bankruptcy Court in White Plains, N.Y., for permission to walk away from its lease obligations for a distribution facility in Columbus, Ohio, that had served its 67-store Big Bear chain in Ohio and West Virginia. The court is scheduled to hold a hearing Thursday on the three leases on the Columbus facility. Last week, the company also requested the court's permission to sell three of its Bi-Lo stores in Pennsylvania. Penn Traffic filed for a Chapter 11 bankruptcy reorganization in May and has since closed or sold all the units in the Big Bear chain.

WORKERS AT STOP & SHOP SCHEDULE STRIKE VOTE

QUINCY, Mass. -- Roughly 42,000 union members working for Stop & Shop Supermarkets here, an Ahold operating company, were scheduled to take a strike vote Feb. 15 immediately following a vote on the company's contract offer, a union official told SN. According to Brian Petronella, president, United Food and Commercial Workers Union Local 371, Westport, Conn., the contracts of five UFCW locals representing workers in Massachusetts, Connecticut and Rhode Island are set to expire Feb. 14. Officials from all five locals have been sitting in each others' negotiations with Stop & Shop. Petronella noted that a strike is a strong possibility. A Stop & Shop spokesman said the company was "bargaining in good faith," and expected to have a contract offer acceptable to its employees by Feb. 15.

SECOND FIRM LOWERS RATINGS ON WINN-DIXIE NOTES

NEW YORK -- Moody's Investors Service here said it has lowered all ratings of Winn-Dixie Stores, Jacksonville, Fla., including the 8.875% senior note issue to B1 to Ba2. Moody's said the downgrade was prompted by its belief that Winn-Dixie's "recent deterioration in revenue, margins and debt protection measures will persist over at least the medium-term." Earlier this month, Standard & Poor's Credit Ratings Service lowered the company's corporate credit rating to B from BB.

WAL-MART SUES OVER CALIF. TOWN'S SUPERCENTER BAN

TURLOCK, Calif. -- Wal-Mart Stores, Bentonville, Ark., last week said it filed lawsuits with the California Superior Court and Federal Court challenging an ordinance by the city council here banning supercenters over 100,000 square feet. Wal-Mart alleges that: the ordinance was passed without an environmental assessment; the city illegally used zoning laws to regulate competition; and the ordinance is "arbitrary and capricious." In an interview with SN, Charlie Woods, community development director for Turlock, said the city stands by its ruling, which he said was based on the potential impact of a supercenter on traffic patterns and its potential to create blight in other areas of the city. Separately, the Gilroy, Calif., city council is scheduled to vote tomorrow on whether to allow Wal-Mart to build a 220,000-square-foot supercenter there. Local sources said the council is expected to approve the measure following a 6-1 vote two weeks ago by the city's planning commission to approve the construction project. The supercenter is expected to open sometime next year.