Fairway Market today denied published reports that it plans to liquidate and close all of its 14 stores in metropolitan New York.
Fairway said Wednesday that it’s in talks to secure financing that would keep stores in operation. The New York-based upscale grocer called reports that it aims to file for Chapter 7 bankruptcy “categorically untrue and disappointing.” This morning, the company also denied the liquidation reports in a tweet.
“Despite reports, Fairway Market has no intention to file for Chapter 7 or liquidate all of its stores,” the company said in a statement released today. “Fairway has been engaged in a strategic process and expects to soon announce a value maximizing transaction that will provide for the ongoing operations of stores. Our lenders remain extremely supportive of our efforts. All 14 stores remain open for business, offering a complete range of high-quality, specialty food products, and we look forward to seeing our customers and employees.”
The New York Post reported yesterday that Fairway, according to unnamed sources, was “getting ready to call it quits” with plans to file for Chapter 7 and shut all of its stores. Following Fairway’s statement on Wednesday, another Post article said the grocer declined to elaborate on its plans going forward and “didn’t deny that the company was planning to close stores.”
Currently, Fairway operates eight stores in New York City (five in Manhattan, two in Brooklyn and one in Queens); two in Long Island, N.Y.; one in New York’s Westchester County; two in New Jersey; and one in Connecticut. The retailer’s website also lists four Wine & Spirits stores among its locations, including two outlets in New Jersey and one apiece in New York and Connecticut.
Earlier this month, the Post reported that Fairway was planning to file for Chapter 11 bankruptcy protection after unsuccessful efforts to find a buyer for its stores. The Post also said that Fairway, owned by lead shareholders Brigade Capital Management and Goldman Sachs Group, is “quietly closing” stores. Fairway didn’t respond to Supermarket News’ request for comment on the report.
Also in early January, debt markets news service Debtwire reported that Fairway retained law firm Weil, Gotshal & Manges as the retailer mulled a possible bankruptcy filing. In addition, Debtwire said Fairway tapped financial advisory firm PJ Solomon for counsel on strategic options, including a potential sale.
The New York Post’s reports this week said Village Super Market Inc., a ShopRite owner-operator based in Springfield Township, N.J., has expressed interest in Fairway locations.
Debtwire noted that Fairway has continued to struggle in an “uber-competitive environment” in the retail grocery arena following a recent reorganization.
In May 2016, parent company Fairway Group Holdings made a "prepackaged" Chapter 11 filing in which lenders agreed to exchange existing debt for new equity and debt in a reorganized company. The retailer emerged from Chapter 11 in June 2016. That came after Fairway couldn’t overcome heavy debt and high costs that persisted following an initial public offering in 2013, in which the company envisioned an aggressive expansion to potentially hundreds of stores.