US supermarket chain files for bankruptcy protection
BI-LO in America yesterday announced that it has filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code. The company, which operates over 215 stores, blamed the deterioration in credit markets for the move, once again highlighting the notion that cash is king in today’s marketplace.
“On an operational level, we are making significant progress this year and we have seen solid sales momentum and strong cash flow,” said Michael Byars, President and Chief Executive Officer of BI-LO. “Our strong operations and liquidity position continue to demonstrate the strength of our business model, and the company has continuously satisfied all of its obligations to date, under the term loan and otherwise. In a normal credit environment we would have expected to refinance the maturing term loan on reasonable terms in the ordinary course of business. Unfortunately, the current credit environment is very challenging.”
The business will remain open, with supplier and business partners to be paid for cost-filing goods sold and services rendered to the company.