USA: C&S signs agreement to purchase Grand Union assets
Consistent with the terms of the previously announced letter of intent, C&S, which is Grand Union's principal supplier, will pay $301.8 million in cash upon closing of the transaction. Included in the assets to be acquired are 185 of Grand Union's 197 stores and the Company's distribution center in Montgomery, New York. C&S intends to operate certain of these stores and to assign its right to purchase certain other of these stores to other supermarket operators.
The closing of the transaction is subject to customary closing conditions, including governmental antitrust approval and Bankruptcy Court approval. The agreement is also subject to higher or better bids for Grand Union's assets, which may be obtained at an auction to be held on November 16, 2000, pursuant to Bankruptcy Court procedures. Grand Union has the right to accept a higher or better bid which might be received at the auction and terminate the C&S agreement, subject to the payment of a break-up fee.
Grand Union filed a voluntary chapter 11 petition in the U.S. Bankruptcy Court in Newark, New Jersey on October 3, 2000, with the stated intention to facilitate the planned sale of the Company and provide for additional funding during the sale process.
Grand Union operates 197 retail food stores in Connecticut, New Jersey, New York, Pennsylvania and Vermont.
Some of the matters discussed herein are "forward-looking statements" within the meaning of the private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. For additional information about the Company and its various risk factors, please see the Company's most recent form 10-K for the fiscal year ended April 1, 2000, as filed with the Securities and Exchange Commission on June 30, 2000, and form 10-Q for the fiscal quarter ended July 22, 2000, as filed with the Securities and Exchange Commission on September 1, 2000.
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