JASPER, Ind. - Buehler Foods here could emerge from Chapter 11 bankruptcy protection as early as this week, an attorney representing the retailer told SN.
Under a plan confirmed by a U.S. Bankruptcy Court judge late last month, the reorganized company will have a new chief executive officer and majority owner, Kris Buehler-Massat, and be financed by its grocery supplier, Associated Wholesale Grocers. Buehler entered Chapter 11 last May when an acquisition of 16 former Winn-Dixie stores in the Louisville, Ky., market went bad.
Buehler-Massat is currently president of Buehler Foods and the daughter of Dave Buehler, the CEO. Dave Buehler will relinquish the title of CEO, according to the attorney, Jerald Ancel of Sommer Barnard, Indianapolis.
Prior to reorganization, stock in Buehler was 67% owned by Dave Buehler; 3% by Kris Buehler-Massat; and 30% by employees through an employee stock ownership plan. Those shares will all be canceled. The reorganized entity will be 51% owned by Buehler-Massat and 49% by her husband, Peter Massat, Ancel said.
Buehler-Massat was not available for comment last week. "She's very bright, and very competent, and AWG has a lot of confidence in her," Ancel said.
Under the reorganization plan, Buehler Foods Inc., operator of 26 Buehler Foods stores, will receive refinancing from AWG, Kansas City, Kan. Buehler LLC and Buehler Carolina, operators of 22 Save-a-Lot stores, will come out as single entity financed by Integra Bank. Buehler of Kentucky will cease to exist, Ancel said.
Creditors of Buehler Carolina will be paid 100 cents on the dollar, Ancel said. Buehler Foods' creditors have been paid a distribution "in the 12- or 13-cent range," Ancel said, adding that a liquidating trust has been created to collect preferences for further distributions.
Ancel said Buehler encountered financial problems after buying and converting 16 former Winn-Dixie stores in the Louisville area in late 2004.
"There wasn't a customer base there that they thought would be there and they found it a difficult market to compete in," he said. "They put a lot of money into the stores thinking they could attract back the customer base, but they never came back. They also didn't have a name in the marketplace."
All of the purchased Winn-Dixie stores have since been liquidated.
"The parties all recognized where the case was going and what their rights were and concluded it would be best to come up with a consensual plan," Ancel said. "Everybody gave up something to get it done, including the secured creditors. It's an indication that the business was able to right itself and deal with the problems with the Louisville division. They cut their losses and take pride in the fact that there are still 1,000 employees and stores still in the communities."