Penn Traffic Exploring Compelling Proposals
By George Anderson
Penn Traffic postponed its hearing yesterday to approve the disclosure statement for its reorganization plan under Chapter 11 bankruptcy protection because the company said it had received “multiple compelling proposals for a sale-leaseback transaction” from suitors.
A report on the GlobeSt.Retail Web site speculated that Albertsons and Kroger may be among the parties vying to buy the struggling chain. Penn Traffic operates 107 stores in Pennsylvania, upstate New York, Vermont and New Hampshire under the BiLo, P&C and Quality banners. The company also operates a wholesale food distribution business serving 80 licensed franchises and 41 independents.
Robert Chapman, president and chief executive officer of Penn Traffic, said in a released statement, “The proposals on the table would unlock the intrinsic value in the company’s real estate assets, eliminate the need for any long term debt upon the company’s emergence from bankruptcy and significantly enhance our liquidity, which will in turn enhance our ability to compete in our core markets.”
Moderator’s Comments: Which of the major chains would benefit most from a deal to acquire Penn Traffic? What is the
best-case scenario for Penn Traffic and the consumers in the markets it serves?
This was the second time Penn Traffic postponed the hearing over its disclosure statement. The company originally had a court date scheduled for September
23. That was the first indication the company had given it was considering proposals for its business.
In a separate but related development, the Syracuse Post-Standard reports that several groups are contesting Penn Traffic’s disclosure statement
because of a lack of detail on how the company will deal with individual creditors. –
George Anderson – Moderator
- Penn Traffic Announces
Postponement of Disclosure Statement Hearing and Continued Pursuit of Sale-Leaseback Transaction – Penn Traffic Company/Business Wire
- Penn Traffic Stores In Play – GlobeSt.Retail
- Three groups object to Penn Traffic’s plans – Syracuse