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The Penn Traffic Co. has been granted an additional six weeks to find a potential buyer for its 79 supermarkets in the wake of declaring Chapter 11 bankruptcy last month, according to published reports. GE Capital, the financially troubled Syracuse, N.Y.-based grocer’s largest lender, has agreed to extend its deadline for bids until the end of next Monday. The original deadline was Dec. 21.
Last week, Sen. Charles Schumer (D-N.Y.) requested that GE Capital extend the deadline to keep stores open and associates working during the holidays. “This welcome decision by GE Capital to extend the deadline for bids means thousands of New York workers can breathe a little easier through the Christmas season as Penn Traffic identifies a buyer that will keep open the maximum number of stores,” noted Schumer. “This is very good news for both workers at these stores and for upstate consumers, who deserve good choices and food shopping options. It means more time to find a bidder that will keep more stores open, potentially saving thousands of jobs.”
According to Schumer, before acceding to the request for a deadline extension, GE Capital might have liquidated the stores, which would probably have led to 6,000 layoffs close to Christmas.
Among the bids already received for Penn Traffic is a $54 million offer for 22 P&C stores from Schenectady, N.Y.-based Price Chopper and, according to a report citing anonymous sources in the Syracuse Post-Standard, C&S Wholesale Grocers is seeking to acquire the whole company for a low-ball figure $36.5 million. Keene, N.H.-based C&S, which serves as Penn Traffic’s supplier and operates the chain’s three warehouses, was reported to have made its bid through a consortium of liquidation and reorganization businesses, headed by buyer whose name hasn’t been made public. Tops Markets, LLC has also been identified in published reports as a potential bidder for Penn Traffic’s entire operations, allegedly for $90 million
Any bids for Penn Traffic’s assets have to be approved by the bankruptcy court.