Central Grocers agrees to sell 19 Strack & Van Til stores to Jewel Foods Stores
US-based grocery retailer Central Grocers has entered an asset purchase agreement to sell 19 Strack & Van Til stores and certain other assets to Albertsons Companies’ Jewel Foods Stores (Jewel-Osco).
Under the agreement, Jewel-Osco will serve as the stalking horse bidder in a court-monitored sale process.
Central Grocers filed for bankruptcy protection under Chapter 11 of the Bankruptcy code in the US Bankruptcy Court for the District of Delaware earlier this month.
Jewel-Osco has offered $100m for the deal, specifically $70m for the stores and $30m for store inventory, reported The Times of North-West Indiana.
The company also reported that it is evaluating offers for its one-million square foot distribution centre in Joliet, Illinois, US, and its six additional Raceway real estate assets.
The grocery chain company has stated that all Strack & Van Til, Town & Country Market and Ultra Foods stores in Indiana and Illinois are currently open and serving customers.
The company has noted that the transaction does not include the three Ultra stores and it will continue to pursue a sale of those assets.
The proposed transaction is in accordance with Section 363 of the US Bankruptcy Code and subject to higher or better offers.
According to Central Grocers, the stalking horse bidder arrangement will result in Jewel-Osco becoming the standard setting bid for the court-supervised auction process.
On 2 June, a hearing in the Bankruptcy Court will approve the proposed bidding procedures and the auction process.