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Fairway Market files for bankruptcy, to sell stores

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NEW YORK — Fairway Market said Thursday that it had filed for Chapter 11 bankruptcy protection, and planned to sell off its stores.

The company said it had entered into a stalking horse asset purchase agreement to sell up to five of its New York City Fairway stores, as well as its distribution center, to Village Super Market Inc., for approximately $70 million. In addition, the company said it would would execute a court-supervised process to to negotiate for the sale of its remaining store locations. Fairway Market has 14 stores, including eight in New York City, three in the city’s New York suburbs on Long Island and in Westchester County, two in New Jersey and one in Connecticut.

Village Super Market, a member of the Wakefern Food Corp. cooperative, operates 30 ShopRite stores in New York City, New Jersey, Maryland and Pennsylvania, as well as three Gourmet Garage stores in New York City.

An ad hoc group of the Fairway Market’s senior lenders have agreed to support the sale process and will provide the company with up to $25 million in debtor in possession financing.

Fairway Market plans to continue operating its stores and serving its customers while the sale of its outlets is conducted, and the company said it will maintain its promotional and loyalty programs during the process.

“We would like to extend gratitude to our employees, vendors, distributors and customers for their support, dedication and loyalty over the years,” Fairway Market chief executive officer Abel Porter said in a statement. “It has always been Fairway’s priority to ensure our patrons are provided with the most optimal grocery experience, with the freshest foods and best quality products, and our employees feel appreciated. After careful consideration of all alternatives, we have concluded that a Court-supervised sale process is the best way to meet our objectives of preserving as many jobs as possible, maximizing value for our stakeholders, and positioning Fairway for long term success under new ownership.”

Village Super Market Inc. CEO Robert Sumas said his company would preserve the Fairway name and spirit.

Perry and Nick Sumas opened the first Village Market in 1937, and our family continues to believe deeply in the importance of neighborhood grocery stores,” Sumas said. “We appreciate that Fairway’s loyal customers are concerned about the future, and if we are successful in our bid, we are committed to keeping Fairway, including its name, unique product selection and value, a part of this community.”


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