KEENE, NH – C&S Wholesale Grocers Inc. has won the competitive bankruptcy auction for Associated Wholesalers Inc. (AWI) with a $288 million bid.
As we previously reported, C&S initially assumed the position of the “stalking horse” or initial bidder with a bid of up to $170 million, depending on various factors.
Mark S. Indelicato of Hahn & Hessen LLP told Law 360 that the price for the cooperative food distributer increased almost 70% to end at $288 million, almost $120 million over the original offer.
According to Indelicato, there were two bidders that went head-to-head at the auction. Though he did not identify C&S’s challenger, Mark stated that the rival may be revealed at the hearing where U.S. Bankruptcy Judge Kevin J. Carey will consider the sale.
In September, AWI filed for chapter 11 protection listing over $200 million in debts. According to Bloomberg, AWI’s White Rose unit has also filed for bankruptcy due to what Chief Restructuring Officer Douglas Booth called “compressed margins and fierce competition.”
Last month, Rick Cohen, Chairman and CEO of C&S, spoke on the potential acquisition saying, “The addition of AWI and White Rose would expand C&S’s footprint and enhance our significant capabilities in servicing independent grocers.”
Among AWI's listed creditors were food giants Tyson, Kellogg, General Mills, ConAgra, Smucker, Nestle, Kraft, and Dannon. According to Bloomberg, AWI owes as much as $100 million in debt to its various creditors.
Will the sale be approved, and will we find out the identity of the rival bidder? Stay tuned to AndNowUKnow for updates as we continue to track this story.
