GARDINER, Maine — The collapse of Associated Grocers of Maine here has sent many of its 240 retail members scrambling for alternative sources of supply, according to a local industry executive.
Mike Bourgoine, president and chief executive officer of Associated Grocers of New England, told SN his company had tried to work with AGM and its bankers “to resolve some issues so this wouldn't happen, but unfortunately we did not succeed.”
AGM said two weeks ago it had gone into receivership and would liquidate its operations after Savings Bank of Maine, one of its two lenders, commenced litigation in Superior Court against the company, prompting the court to appoint a receiver to oversee the assets pledged as collateral for the bank's loans.
Bourgoine said AGM's members were not aware of the situation in advance, so when the liquidation was announced, they had to look for new suppliers immediately.
Some of the larger AGM members have reportedly become customers of Bozzuto's, Cheshire, Conn., and at least one retailer has gone with C&S Wholesale Corp., Keene, N.H., Bourgoine said. Representatives of Bozzuto's and C&S could not be reached for comment.
Of the remaining AGM members, AG of New England said it was interested in signing up roughly half, based on size and volume, while the remainder — mostly convenience stores — will have to find c-store suppliers. AG of New England has signed up about two-thirds of the AGM members it was interested in, who are expected to add about $70 million to the cooperative's sales base of $400 million, Bourgoine told SN.
In a letter to customers and vendors posted on the AGM website last week. James C. Ebbert, the court-appointed receiver, said, “The company's business was not viable. Neither of the two secured lenders is willing to advance additional funds, and the company's financial condition does not allow for any alternative financing.”
