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Associated Wholesalers gets OK on $164 million sale to stalking horse
By Kali Hays
New York, Oct. 30 – Associated Wholesalers, Inc. obtained court authorization to sell substantially all of its assets to C&S Wholesale Grocers for $164.22 million, according to a Wednesday order from the U.S. Bankruptcy Court for the District of Delaware.
A Thursday news release said that the company expects the sale to close in early November.
SuperValu, Inc. will act as the back-up bidder for the assets.
As previously reported, C&S acted as the stalking horse bidder for the assets, and the purchase price includes a credit bid of $18.1 million and the assumption of liabilities.
Additional bids were due by Oct. 22 in initial increments of $500,000 over the stalking horse bid.
Associated held an auction on Oct. 24 where C&S was declared the prevailing bidder.
Matt Saunders, Associated’s president and CEO, said bidding at the auction was “robust and competitive” but the C&S bid “is in the best interest” of the company and its stakeholders, according to the news release.
Under the stalking horse agreement, if C&S had not been the winning bidder for the assets it was entitled to a break-up fee of $3.75 million and expense reimbursement up to $1.5 million.
Upon filing the bid procedures, Associated said a “prolonged sale process in a lengthy Chapter 11 proceeding would only serve to erode customer confidence and prove detrimental to business,” and considering its “ongoing liquidity restraints” the company said the sale had to close before the winter holiday season begins.
Associated Wholesalers is a cooperative food distributor and equipment retailer based in Robesonia, Pa., that filed for bankruptcy on Sept. 9. The Chapter 11 case number is 14-12092.
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