One of our business partners finally took the step we considered they might....
Winn-Dixie Files for Chapter 11:
Winn-Dixie Stores Inc. early Tuesday said it filed for bankruptcy protection, citing financial challenges that have worsened since the grocer reported a much-wider fiscal second-quarter loss earlier this month.Winn-Dixie and 23 of its U.S. subsidiaries filed for Chapter 11 protection late Monday in U.S. Bankruptcy Court for the Southern District of New York, the Jacksonville, Fla.-based company said.
Winn-Dixie said it has secured an $800 million credit facility from Wachovia Bank N.A. to help pay for its reorganization. The credit facility, subject to court approval, replaces the company's previous $600 million credit line.
Winn-Dixie plans to use the reorganization to improve its operations and financial performance, but also to reduce its expenses and decide how to use its assets to make its stores more productive, the company said. “This includes achieving significant cost reductions, improving the merchandising and customer service in all locations and generating a sense of excitement in the stores,” Peter Lynch, president and chief executive officer, said in a statement.
The company, which employs about 80,000 workers, said 920 Winn-Dixie stores in eight states and the Bahamas are open.
...Under Chapter 11 of the U.S. bankruptcy code, a company is freed from the threat of creditors' lawsuits while it reorganizes its finances. The debtor's reorganization plan must be accepted by a majority of its creditors. Unless the court rules otherwise, the debtor remains in control of the business and its assets.
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