A&P Looking To Sell 120 Stores, Close 25

The Great Atlantic & Pacific Tea Company Inc. (A&P) has filed its second voluntary petition for Chapter 11 bankruptcy reorganization in five years. As part of the filing, the national grocery store retailer is asking for approval to sell up to 120 stores for $600 million.

In addition, A&P is seeking lease cancellations for 25 additional stores.

"After careful consideration of all alternatives, we have concluded that a sale process implemented through chapter 11 is the best way for A&P to preserve as many jobs as possible, and maximize value for all stakeholders," Paul Hertz, president and CEO of A&P, said in a statement announcing the move.

Interest from other grocery operators has been robust during the company’s sales process to date, Hertz added.

Evercore Group LLC, A&P’s investment bankers, has been marketing a set of what A&P calls its Tier 1 stores for sale. Evercore contacted more than 30 potential buyers and to-date have received eight bids from that process.

The company currently operates 296 stores primarily in the Northeast under the brand names A&P, Best Cellars, Food Basics, The Food Emporium, Pathmark, Superfresh and Waldbaum's.

The 25 stores being closed were identified by A&P as Tier 3 stores and have posted ongoing store operating losses, the company said. The stores have an aggregate daily negative cash flow rate of $75,000 and $2.5 million each month.

The closure of the stores is expected to save about $20 million for the remainder of the 2015. Selling the assets from those store could yield $48 million in gross proceeds, the company added.

"While the decision to close some stores is always difficult, these actions will enable the company to refocus its efforts to ensure the vast majority of A&P stores continue operating under new owners as a result of the Court-supervised process,” Hertz said.

A&P previously filed for Chapter 11 reorganization in December 2010. That process resulted in the closing of about 50 stores and A&P exiting the Washington/Baltimore region.

Stores Slated for Closure

2105 Philadelphia Pike, Claymont, DE
3901 Lancaster Pike, Wilmington, DE
115 Belmont Ave, Belleville, NJ
325 Route 35, Cliffwood, NJ
Botany Plaza 85 Ackerman Ave, Clifton, NJ
895 Paulison Ave, Clifton, NJ
50 Race Track Rd, East Brunswick, NJ
561 Route 1, Unit B, Edison, NJ
2101 Route 35, Holmdel, NJ
651 North Stiles St, Linden, NJ
1043 US Route 9, Old Bridge, NJ
1256 Indian Head Road, Toms River, NJ
2 Westbury Avenue, Carle Place, NY
2150 Middle Country Rd, Centereach, NY
3620 Long Beach Rd, Oceanside, NY
399 Route 112, Patchogue, NY
1510 Old Country Rd., Riverhead, NY
1301 Skippack Pike, Center Square, PA 
400-450 W. Swedesford Rd, Devon, PA 
420 MacDade Blvd, Folsom, PA 
863 E. Baltimore Pike, Kenneth Square, PA 
1851 S. Christopher Columbus Blvd, Philadelphia, PA 
840 Cottman Ave., Philadelphia, PA 
85 Franklin Mills Blvd, Philadelphia, PA 
300 S. Best Ave & Main St, Walnutport, PA 
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