SYRACUSE, N.Y. -- Penn Traffic here, which has been operating under Chapter 11 since May 2003, plans to make an offer on two stores in this area operated by Peter's Groceries, which has been operating under Chapter 11 since February 2003.
Peter's is a wholesale customer of Penn Traffic.
The U.S. Bankruptcy Court in Utica, N.Y., which has been overseeing Peter's Chapter 11, scheduled a Dec. 8 auction on the company's stores. Three of the stores are closed, while the two that Penn Traffic is interested in are still operating.
Mark Jampole, a Penn Traffic spokesman, declined to pinpoint the amount of the offer. However, industry sources said it is reportedly $1.4 million for the two stores, including the cost of inventory.
Jampole said Penn Traffic hopes to convert them to the P&C banner if its offer is accepted.
"Our interest in these two stores reflects the next stage of our restructuring, which is to reinvest in the marketplace and make strategic acquisitions that clearly make sense," he said.
In other action last week, Penn Traffic said it has asked the U.S. Bankruptcy Court in White Plains, N.Y., for a third extension -- until Jan. 24 -- to file its reorganization plan so the company has more time to explore its options on a sale/leaseback plan for 17 stores and five warehouses.
"If the sale/leaseback proceeds, we could emerge from Chapter 11 debt-free, with cash reserves," Jampole said, "in contrast to the reorganization plan we filed in August, which would have left the company with $55 million in bank debt and $50 million worth of available credit."
