Jewel-Osco would set the bidding floor for a Strack & Van Til purchase if an auction were required by the court. Freeimages.com/Margan Zajdowicz
Jewel Food Stores Inc. (Jewel-Osco), based in Itasca, has entered into an agreement to buy 19 Strack & Van Til stores following the announcement that Central Grocers Inc., the owner of the chain, was $225 million dollars in debt. The court proceedings were initiated when major creditors including Coca-Cola and General Mills filed a Chapter 7 petition to liquidate the company in order to recover its debts.
Central Grocers responded by filing for Chapter 11 bankruptcy and asking the court to dismiss the Chapter 7 complaint, allowing it to manage its bankruptcy and find buyers for its stores and distribution center.
Jewel-Osco has agreed to purchase 19 Strack & Van Til stores as well as interview and retain employees when possible. The purchase will have to first be approved by the court, which may require that an auction be held prior to the purchase. If such an auction is held, Jewel-Osco would be able to set the floor as the first bidder.
The 19 Strack & Van Til stores, all located in Indiana, are all included in the agreement and would remain open during the purchase.