Nov. 4 (Bloomberg) -- Bankrupt Great Atlantic & Pacific Tea Co. agreed to $490 million of debt and equity financing from Ron Burkle’s Yucaipa Cos., Mount Kellett Capital Management LP and investment funds managed by Goldman Sachs Asset Management LP.
The agreement will enable A&P to emerge from Chapter 11 bankruptcy court protection early next year, the Montvale, New Jersey-based supermarket operator said yesterday in a statement sent by Business Wire. The agreement is subject to approval by the U.S. Bankruptcy Court in Manhattan.
“This investment commitment is a very important step in A&P’s financial and operational turnaround,” Sam Martin, A&P’s chief executive officer, said in the statement. “It positions us for a bright future with solid financial backing from sophisticated investors who know our company and industry well.”
A&P filed for Chapter 11 in December 2010 after failing to turn around its business amid increased competition from wholesale clubs and drugstores. It operates supermarkets under names including Waldbaum’s, Food Emporium and Pathmark.
The case is In re Great Atlantic & Pacific Tea Co., 10- 24549, U.S. Bankruptcy Court, Southern District of New York (White Plains).
--Editors: Peter Blumberg, Michael Hytha
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