LOS ANGELES (CNS) — The Haggen grocery chain that took over numerous Albertsons and Vons stores earlier this year has announced it has filed for Chapter 11 bankruptcy.
The Bellingham, Washington-based company has received commitments for up to $215 million in debtor-in-possession financing from its existing lenders to maintain operations and the flow of merchandise to its stores during the sale process, CEO John Clougher said.
“After careful consideration of all alternatives, the company concluded that a reorganization through the Chapter 11 process is the best way for Haggen to preserve value for all stakeholders,” Clougher said.
“The action we are taking will allow us to continue to serve our customers and communities while providing Haggen with a process to re-align our operations to be positioned for the future.”
Haggen has engaged Sagent Advisors to market for sale some locations in the five states it operates and to explore market interest for various store locations, Clougher said.
Discussions are underway with interested parties to sell many of the company’s remaining assets, Clougher said.
Haggen grew from an 18-store regional grocer to a 164-store chain through the purchase of Albertsons locations in December.
Haggen recently sued Albertsons, claiming it did not fulfill terms of the purchase agreement.
Haggen announced plans last month to close or sell 27 stores, including four in Orange County and one in Los Angeles County.