A grocer founded in the 1800s and once the largest grocery chain in the country has filed for bankruptcy, Bloomberg reports.
It’s the A&P, officially known as the Great Atlantic & Pacific Tea Co.
According to the article, "Great Atlantic & Pacific Tea Co., which operates almost 400 supermarkets under the Waldbaum’s, The Food Emporium and Pathmark names, sought bankruptcy protection after failing to successfully compete with wholesale clubs and drugstores.The retailer had $8.8 billion in sales for the year ended in February, according to its website. Yesterday, it listed assets of $2.5 billion and debt of $3.2 billion in a Chapter 11 filing in U.S. Bankruptcy Court in White Plains, New York. "
The article adds, " ‘The company couldn’t compensate for the combination of high debt and the suddenly fading purchasing power of the customers,’ Karl-Erivan Haub, chief executive officer of Tengelmann Group, A&P’s biggest shareholder, said in an e-mailed statement today. The insolvency will help A&P to get a ‘solid financial basis, to advance necessary restructuring,’ he added. Tengelmann, which owns Germany’s biggest home-improvement retailer, OBI, and the Kaiser’s supermarket chain, sees no impact on its other business from A&P’s insolvency, spokeswoman Jutta Meister said in an interview. The closely held retailer has previously written down the value of its A&P stake in the past and will now cut it to zero, she added."