EL SEGUNDO, CA
Fresh & Easy Neighborhood Market has filed for Chapter 11 bankruptcy in U.S. Bankruptcy Court. The grocer is currently in the process of trading hands from Tesco to Burkle’s Yucaipa Cos., and has cited debt between $500 million and $1 billion in its court filing, according to The L.A. Times.
Brendan Wonnacott, Spokesperson for Fresh & Easy, tells DeliMarket TV, "Today's filing is simply the next step in the restructuring process to sell the business to The Yucaipa Companies and will have no impact on our customers shopping experience. It’s business as usual as we continue the transition to new ownership."
With six unprofitable years in the chain's recent past plus a deal with Burkle, Fresh & Easy recently started closing down some stores, including a group in San Diego. With Fresh & Easy in bankruptcy, Tesco can back out of leases before they conclude and auction off the brand’s assets, the report notes.
The announcement of the acquisition sparked speculation regarding the revival of natural grocery chain Wild Oats. Yucaipa will acquire more than 150 of Fresh & Easy’s approximate 200 stores along with its distribution and production facilities.
Ron Burkle, billionaire Yucaipa founder and former Wild Oats investor, commented that the purchase of Fresh & Easy would give them a solid starting point to complete Tesco’s vision with some changes that the company thinks will make it even more relevant to today’s consumer, according to earlier reports.
Stay tuned to DeliMarket TV as we follow the Fresh & Easy transition.