High-end supermarket chain operator Fairway files for bankruptcy

U.S-based high-end supermarket chain Fairway Group filed for a “pre-pack” bankruptcy and reached an agreement with creditors to cut $140m in debt.

The chain, which primarily operates its stores in New York, reached an agreement with 70% of its senior secured creditors to convert $140m of c.$279m of debt into equity.

The “pre-pack” chapter 11 filing is an agreement and restructuring plan with a majority of creditors that has already been reached.

The secured lenders have also provided $55m in a superpriority secured debtor-in-possession (DIP) credit facility and a $30.6m letter of credit to cover operating financing.

The proposed DIP financing would support Fairway’s reorganization plans and enable normal post-petition operation of its business, including timely payment of employee wages, benefits and other obligations.

Source:  Undercurrent News