Central Grocers Creditors Attempt to Force Involuntary Bankruptcy, Reclaim $1.8 Million Unpaid
JOLIET, IL – Central Grocers is facing involuntary bankruptcy, as several of the nation’s largest food providers attempt to reclaim nearly $2 million dollars in unpaid bills.
"Central is reviewing the involuntary petition filed by certain vendors and will respond to it shortly. The Company’s Strack & Van Til stores are open for business and serving customers," said Jeff Strack, CEO of Strack & Van Til, in an email reported on by the NWI Times
According to the NWI Times’ report, creditors—including the Coca-Cola Company, General Mills, Mars Financial Services, and Post Consumer Brands—filed an involuntary bankruptcy case in an attempt to recoup a debt totaling $1.8 million.
The retailer’s creditors have filed suit in the U.S. Bankruptcy Court Northern District of Illinois in an attempt to force Chapter 7 bankruptcy—a move that would force Central Grocers to shut down and liquidate assets from its $2 billion business to repay a portion of what they are owed.
Though the lawsuit is sizeable, there is no indication that it reflects the entirety of Central Grocers’ debt, and more creditors may come forward to join the petition.
The lawsuit follows an announcement last month that Central Grocers plans to sell its 22 Strack & Van Til locations and close nine stores operating under the Ultra Foods banner.
"Central Grocers continues to work with its legal and financial advisors toward implementing a sale of the Strack & Van Til stores and is continuing to explore strategic alternatives for the other parts of our business, which may include a sale transaction," said Strack.
For more on the situation as it develops, stay tuned to AndNowUKnow.