MONTVALE, NJ – Locals of the United Food and Commercial Workers (UFCW) International Union have ratified modifications to their collective bargaining agreements with the Great Atlantic & Pacific Tea Company Inc. (A&P). The new contracts are an important step toward completing A&P’s financial restructuring.
“This agreement with our labor unions marks a significant milestone in our turnaround efforts,” said Sam Martin, A&P’s president and CEO. “I want to thank our associates for their steadfast commitment to serving our customers throughout this process. As we position the company to emerge from Chapter 11 early next year with a much stronger financial and operating foundation, we intend to continue making operational and service improvements to further enhance the value and in-store experience we provide to our customers.”
A&P said the agreement with its labor unions is consistent with, and contemplated by, the previously announced joint financing commitment from The Yucaipa Companies, Mount Kellett and investment funds managed by Goldman Sachs Asset Management. On Nov. 14, the US Bankruptcy Court for the Southern District of New York granted approval of the investment agreement, contingent upon successful resolution of A&P’s negotiations with its labor unions.
A&P filed a joint Plan of Reorganization and Disclosure Statement with the Court on Nov. 14, which is subject to closing conditions, as well as approval from the company’s creditors and the Court. Ratification of the Plan of Reorganization by the company’s creditors will enable it to pay secured lenders in full in cash and fund cash recoveries for general unsecured creditors.
During the A&P’s exit process, the company intends to continue to operate its stores normally. A&P and its subsidiaries filed voluntary Chapter 11 petitions on Dec. 12, 2010.
A&P is one of the nation's first supermarket chains. It operates 336 stores in seven states under the trade names A&P, Waldbaum's, Pathmark, Best Cellars, The Food Emporium, Super Foodmart, Superfresh and Food Basics.
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