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MONTVALE, N.J. – A&P may be on the verge of filing for bankruptcy protection, possibly as early as this week, according to published reports.
The food and drug retailer’s filing is expected to come in the form of a “prepackaged” bankruptcy, which could divvy up the company’s best locations, the New York Post reported on Wednesday.
A&P did not confirm the Post’s report. Other media outlets have been reporting in recent days that the Montvale, N.J.-based company was looking to find a buyer or an option that would prevent a bankruptcy.
“No decision has been made regarding a particular outcome, and it would be inaccurate and irresponsible to suggest otherwise,” a company spokesman told the Post. “The company is committed to continuing to serve its customers and communities as it always has and intends to keep its stores fully staffed.”
A&P at one time was one of the biggest supermarket operators in the United States, but by last year it had dwindled to about 300 supermarkets, mostly in New York and New Jersey. Its supermarkets operate under the A&P, Pathmark, Waldbaum’s, Superfresh, Food Emporium and Food Basics banners. More than half of its supermarkets have in-store pharmacies.
In March 2012, after 15 months under Chapter 11 bankruptcy protection, A&P emerged as a privately held company with a smaller store base — going from about 400 stores to 320 — and a tighter focus on its core markets. Besides arranging new financing, the company assembled a new management team, negotiated a new supply and logistics agreement with its principal supplier, worked with unions to modify collective bargaining agreements, refurbished stores and eliminated closed store leases. A comprehensive marketing campaign followed.
However, the grocer continued to struggle amid intense competition from other supermarket chains, discount stores and warehouse clubs. In the summer of 2013, news reports surfaced that the company was seeking a buyer, with Kroger Co., Ahold N.V. and Cerberus Capital Management LP cited as potential buyers. A&P president and chief executive officer Sam Martin stepped down in January 2014. Executive chairman Greg Mays served as interim CEO until chief operating officer Paul Hertz was named as president and CEO in March 2014.
