Even companies that are in the largest industries can fall prey to the recession. With stronger competition and people being more frugal with their money, a lot of companies have suffered from decreased sales and have fallen into debt with their creditors. Businesses in New Jersey can have hope for the future by filing for Chapter 11 as an opportunity to restructure and cut away some excess processes so that they may peek a new buyer's interest.
Associated Wholesalers Inc. (AWI) had made an announcement earlier this year that it would be interested in selling off its subsidiary, White Rose, but now it wants to sell the entire company. Recently, AWI agreed to have C&S Wholesale Grocers as the stalking horse bidder to set the bar for the upcoming sale. The company may receive better offers as the bidding process continues.
According to the chairman and vice president of the board of AWI, this transaction with C&S would be in the best interest of the stakeholders. They also stated that, after researching the alternatives, the best course of action was to enter into the agreement with C&S and go forward with the process. The chairman and CEO of C&S stated that acquiring AWI and White Rose would be a way for the company to service both companies' customers since it is such a great complement to their own portfolio.
As part of the process, AWI received "debtor in possession" financing and motions from the court to help them continue operating during the Chapter 11 process. This would allow for the employees to still be paid along with keeping their benefits, and also to continue servicing their customers and paying suppliers. New Jersey businesses that are struggling to make ends meet may find a solution in filing for Chapter 11. Through the process, they may be able to build the foundation for a more successful future and become more attractive to a prospective buyer.
Source: supermarketnews.com, "Breaking: C&S bids to acquire AWI, White Rose in Chapter 11", Jon Springer, Sept. 9, 2014