The first of two speculated high profile retail bankruptcies has been filed. Tops Markets LLC filed for reorganization under chapter 11 on Feb. 21 in the Southern District of New York.
Southeastern Grocers, parent company of Bi-Lo LLC, Winn-Dixie, Fresco Y Mas and Harvey’s, also is expected to file for bankruptcy as early as March, according to a Bloomberg report. As many as 200 stores in the Jacksonville, Fla.-based company’s portfolio could be closed.
Unlike Southeastern Grocers, Williamsville, N.Y.-based Tops, which operates about 170 stores in New York, Pennsylvania and Vermont, does not plan to close stores. The company said in a statement it plans to continue day-to-day operations, and that it has received commitments for a $125 million debtor-in-possession term loan financing facility from note holders, and a $140 million debtor-in-possession asset-based revolving loan.
“We believe the financing that we received from our noteholders is a vote of confidence in our business,” said Tops CEO Frank Curci, in a statement. “Our operations are strong and we have an outstanding network of stores and a talented team to support them.”
Tops established a website for restructuring information, www.topsrestructuring.com. The company said in a statement it intends to pay vendors and suppliers in full “under normal terms for goods and services provided after the filing date of Feb. 21.” A letter to vendors dated Feb. 21, and vendor FAQs also are posted on the site.
According to court filings, the company’s top creditors include:
- Nearly $80 million to U.S. Bank;
- $54.7 million to C&S Wholesale;
- $7.8 million to Topco;
- $2.5 million to United Natural Foods.
The company has estimated assets of $500 million to $1 billion and liabilities in excess of $1 billion, according to the court documents. Recent media reports estimate the company had more than $720 million in debt, with annual interest payments of more than $80 million.