With an April deadline set to increase cashflow, Fairway Market could face bankruptcy in the near future.
“Our current limited cash resources and significant leverage will adversely affect our ability to open new stores,” the company stated, according to the New York Post, which is how it is currently hoping to raise some much-needed funds.
The report also states that the “significant losses” the chain has seen in its 15 metro-area stores— more than $300 million over the past five years, $35.7 million of which were in the quarter ended Dec. 27th— the company will have a hard time meeting the certain debt obligations.
Fairway has listed among its struggles that its biggest competitors have “more experience operating multiple store locations or have greater financial or marketing resources,” according to the report. Among those listed in that respect are Whole Foods, Trader Joe’s, and Stop & Shop.
Should the company choose to file for bankruptcy, one concern raised was the difficulty of finding buyers in the current market. A&P, who recently liquidated the last of its stores and assets, struggled all of last year to sell of its 100+ stores in the same region.
“The question is whether there is a turnaround in the future of this company,” David Tawil, President of Maglan Capital, told the New York Post. “There is not a big pool of potential buyers as we saw with the A&P bankruptcy.”
DeliMarket News will continue to follow the situation as further details unfold.
