Food Trade News
Mustafa Koita Is A Man On A Mission – A Milk Mission
Until he was almost 40, nothing in Mustafa Koita’s career path would indicate a love and passion for the milk business. He was born in Princeton, NJ and raised in the Chicago area. After graduating from Northern Illinois University, he began a career with U.S. Robotics and worked at several other jobs in the IT and tech fields.
In 2010, he was recruited by Boeing to supervise the defense contractor’s Middle East cyber division based in Dubai. Three years later, feeling a bit burned out and anxious to begin a career as an entrepreneur, Koita left the world of high-tech and formed Koita Foods, processors of organic milk products – both plant-based milk and milk from cows.
But to hear Koita’s story, shift from tech to agriculture isn’t so far-fetched at all.
“I’ve always been passionate about health. While living in Dubai for three years, I noticed my three children didn’t have many healthy eating alternatives. Even when living overseas (he also lived in London), our family would visit the U.S. for a month, and we liked to shop at Whole Foods. I noticed that dairy products from Horizon and Organic Valley commanded a lot of space in the stores, so I thought pursuing an opportunity to introduce organic milk into Dubai would be a sound idea,” Koita explained.
In 2014, using his life savings, Koita embarked on a year-long journey visiting dozens of countries in search of the best milk, the best cows and the best farms. “We scrutinized every aspect of the process without compromise – from treatment of the cows to the environmental impacts of farm operations,” he noted. When the process was completed, he decided that Italian organic grass-fed cows produced the best milk.
“I was very impressed by the ways organic farmers in Italy treated their cows, the attention they gave to the particular grains they grew and the perfection of the soil quality they insisted on. Plus, the way they managed their overall operations was impressive. “The cows fed grass from the very rich soil created by Mount Vesuvius was a critical factor, too,” Koita stated.
The company contracted with two Italian processors – Newlat and Sterilgarda – to co-pack Koita Foods’ line, which was first introduced in Dubai in 2015. “We had no marketing budget, so we started slowly with two products,” Koita recalled. “It was literally all word of mouth and social media. We organized hundreds of focus groups with local moms and we were off and running.”
By 2016, Koita began to grow rapidly in Dubai, achieving distribution through most food outlets. The company then expanded successfully to nearby countries such as Saudi Arabia and Kuwait. The growth story was so notable that Harvard Business School decided to write a case study about Koita’s journey (which they now teach to the Executive MBA class in Boston).
Mustafa Koita then began thinking about the possibility of expanding into the U.S. In 2017, while at a trade show in Dubai, Koita met a U.S. military broker who did business in the Middle East. He wondered if Koita would be willing to sell his products to the U.S. Military in the Middle East if such an opportunity arose. That began a relationship that continues today with Koita Foods serving several government bases in the region.
Meanwhile, the company had further grown geographically and was serving such countries as the Philippines, Singapore, Mauritius and Vietnam (Koita milk is now available in 10 countries). Its product line was also increasing with the addition of several new items including lactose-free and a full range of plant-based milk offerings. Buoyed by its regional success and the exposure to American soldiers and civilian personnel at their military installations, Koita made the decision to test the U.S. waters on a much broader level.
“Truthfully, it was a painful experience,” he noted about the bureaucratic procedure of getting the necessary approvals to gain U.S. entry. “It took about a year for the entire process to be completed, but we are now ready to test the waters.”
Actually, it was only six weeks ago that Koita Foods’ first container of their Milk products arrived in New Jersey. Prior to that, much of the time was devoted to developing an infrastructure that could manage its U.S. business. That included two U.S.-based executives in sales and marketing and the selection of a food broker familiar with Koita’s type of products.
After many interviews, Koita Foods selected Wayne, NJ-based Gourmet Specialties, Inc. to represent the company in the Northeast, Koita Foods’ first targeted marketing area.
One critical decision the company made before entering the U.S. was to sell only plant-based milk products. Those would include organic almond milk, organic coconut milk, oat milk, rice milk, soy beverage and soy for coffee beverage. A seventh item, organic almond/coconut blend, will be introduced later this year. Koita will provide one of the first Italian plant-based milk ranges in the US. All products are UHT (Ultra High Temperature) and sold in shelf-stable aseptic packaging made of recycled paper with a 12-month shelf life.
“The decision not to sell fresh cow milk in the U.S. was rather an easy one,” Koita declared. “We had no desire to compete directly with U.S. dairy farmers. They control the fresh milk market and frankly there was no opportunity for us.”
Koita Foods’ U.S. expansion plan will also focus on building a distributor network (products have been approved at Mansfield, MA-based Chex Finer Foods) and selling to upscale regional and independent retailers whose customer base would seemingly be attracted to Koita Foods high quality, healthy product line.
For Koita, his entrepreneurial mission has come full circle – he’s back in the country where he was born and said that he plans to move back in a few years. He’s eager about the opportunity to sell Koita Foods milk in the U.S. and grateful that his brainstorm of seven years ago has paid off thus far.
“We’ve got a lot more to accomplish and the next phase of our journey won’t be easy,” he said. “But I’m really confident that the quality of our products is superior and distinctive. “We’ve also got a great team (about 25 people) based all over the world who are equally excited about our business. Even my kids don’t think I’m that crazy anymore.”
Albertsons’ New Mid-Atlantic Division Lineup Announced
The organizational chart for new Mid-Atlantic Division of Albertsons has been released and veteran associates from both the Acme Markets and Safeway’s Eastern Division will play key roles in the new alignment which will become fully functional on September 13. Acme’s current headquarters in Malvern, PA will serve as the new division’s primary headquarters with Safeway’s main office in Lanham, MD serving as a support office.
Heading the new team will be Jim Perkins, currently president of Acme, who has been with Albertsons since 1982. Reporting to Perkins will be Tom Lofland, formerly president of Safeway’s Eastern Division, who will relocate and become senior VP-merchandising and marketing. He began his food industry career with Albertsons in 1990 in Florida.
Also reporting to Perkins will be Bill Crosby who becomes senior VP-operations and will oversee a network of 275 stores. Crosby, whose industry career spans more than 40 years, joined Acme in 2008. He was previously VP-operations.
Other key members of the operations team who will serve as vice presidents and report to Crosby include Brad Spooner, Donovan Ford and Rena Shiles. Spooner, VP-operations, will continue his role of overseeing 78 stores in Acme’s Northern Region. He began his grocery career with Randall’s in Texas in 1982.
Ford returns to the East Coast and will also serve as a VP-operations, supervising the 112 Safeway stores in Maryland, Virginia and Washington, DC. Ford is relocating from Albertsons in Texas. He had previously served operational stints at both Acme and Safeway. Ford began his grocery industry career in 1993.
Shiles has been promoted to VP-operations, too. Rena began her career with Safeway’s Eastern Division in January of 2016 and moved up the ranks quickly from an assistant store director to a district manager in 2019. Most recently, Shiles was a DM for 20 Maryland stores in Baltimore, Carroll, Howard, and Montgomery Counties. Prior to joining Safeway, she served 26 years in the United States Army, retiring as a colonel in 2015. She will oversee 86 Acme stores in an area covering Philadelphia and adjacent suburbs, South Jersey, Delaware and Maryland’s Eastern Shore.
On the merchandising team, key appointments and promotions include Jay Schneider who is being promoted director of merchandising, a new position. A 37-year veteran of Acme, Schneider was most recently produce sales manager. He will report to Lofland.
AnneMarie Mozzone now becomes “own brands” sales manager. For the past 14 years, she was assistant sales manager for meat and seafood. Mozzone has been with Acme for 33 years.
Robert George has been promoted to an assistant meat sales manager. He started his career in Las Vegas in 1999 at Lucky’s as a meat clerk. George transferred to Acme in March of this year.
Acme veteran Amanda Lawton is taking on a new role as an assistant Starbucks sales manager. She began her career with Acme in 2008 at the Browns Mills, NJ location. Most recently, Lawton was a Starbucks operations specialist.
Julie Kester has been promoted to an assistant bakery sales manager. She started her Acme career 16 years ago as a bagger in Wilmington, DE at Naamans Road. Most recently, Kester served as bakery operations specialist working in Philadelphia and surrounding suburbs.
On the operations team key appointments and promotions include Michael Styer who becomes director of retail support. During his 30-year Acme career, Styer has held a number of positions such as: store director, center store ops specialist, director of shrink and inventory control, assistant grocery sales manager and district manager in Northern Jersey, his current role. In his new position, Styer will work with functional leads in customer service, asset protection and construction to help drive service and synergies.
Joe Hultz will continue in his role as district manager with an emphasis on special projects. He will focus on new store openings, support the tech rollout of forecasting and replenishment, and lead change initiatives in perishable and center store departments. A third generation Acme associate, Hultz began his Acme career in 1971.
Johnathon Simmons is being promoted to district manager at Acme. He started his career 15 years ago in the Bala Cynwd, PA location. In 2010, Simmons served as a summer management intern for Acme. Upon graduating from Penn State, he became an assistant store director in Upper Darby, PA. He has managed multiple Acme stores and most recently he was center store operations specialist for Northeast Philadelphia.
Christopher Sanchez is being promoted to district manager at Acme. Sanchez began his industry career in 2003 with A&P before transitioning to Acme in 2015, when it acquired more than 70 Tea Company units in PA, NJ, NY and CT. Most recently he was center store operations specialist for Acme stores in Connecticut and New York.
On the merchandising and marketing store support team key appointments and promotions include James Walden III, who will become director of food safety/safety. Walden started his career with Safeway 31 years ago as a courtesy clerk during high school. During his career, Walden held the positions of assistant store director, store director, director of retail support, director of risk management and food safety/safety manager.
Alyssa Geddes is being promoted to an AR/HR manager at Safeway. She has been with Safeway for two years as an HR assistant. Prior to this, Geddes held an HR representative role for Six Flags.
Debra Tunney has been named as the new executive admin for the Mid-Atlantic division’s regional office in Lanham, MD. She brings over 30 years of experience in the fields of financial administration, office management, and customer service. Tunney started her career with Safeway 11 years ago as the assistant to the director of construction. She was also named Safeway’s first employee of the month.
In the new lineup, there have also been some changes in the merchandising and marketing department’s sales managers. The new lineup features Pat Hildebrand as grocery sales manager who is relocating from Safeway.
Acme veteran Kamal Persad is sales manager for GM/HHB; Tim Ley, will remain based in Lanham, MD and serve as liquor (beer and wine) sales manager. In the new division’s fresh departments Ricardo Dimarzio is relocating from Safeway to become sales manager for produce. Mike Salisbury will also move north to oversee meat operations. Acme veteran Charlie Bell now becomes sales manager for seafood. Christine Hixon and Angie Marshall will move from Safeway to become sales managers for bakery and deli respectively. Katie Vasquez will become the division’s new floral sales manager and remain based in Lanham. Additionally, Jay Habben has been named sales manager for special projects in the new alignment.
Other key members of the new team include: Acme/Albertsons veteran Sherry Caldwell who remains director of marketing; Randy Wiest, who will serve as senior director of finance; Marie Esposito, is the director of finance; Joe Conway, who will continue to oversee loss prevention; Shawn Dekker is the new director of construction; and longtime Acme executive Marianne Nice, who becomes director of customer service for the Mid-Atlantic division. Greg Herr has been named director of pharmacy for Safeway and Janis Levitt will hold the same position for Acme.
Other key roles include Sloan Nichols, who becomes director of HR, and Joan Williams, who remains director of labor relations. Until his promotion to a corporate senior VP in May, Dan Dosenbach had long served as VP of labor relations and human resources for Acme.
Three current Safeway executives – Ron Stone, Matt Boyd and Kelly Boyd – will remain part of the Albertsons corporate organization but will not join the new Mid-Atlantic division. Stone, who recently was director of inventory management for Safeway, will remain based in Lanham and serve in a corporate e-commerce role. Matt Boyd, most recently VP-merchandising and marketing for Safeway/Eastern, and his wife Kelly, most recently director of marketing for Safeway/Eastern, will be relocating to company headquarters in Boise, ID to assume new positions.
Additionally, there are several other key associates who will either be retiring or transitioning into different roles outside the company including Joe Perry, most recently VP-operations for Safeway (45 years with Albertsons/Safeway); Kim Gray, most recently VP-merchandising and marketing for Acme (38 years with Albertsons); Mary Washinko, most recently deli sales manager for Acme (45 years with Acme); Mike Porte, formerly with Acme’s corporate crisis response team (44 years with Acme); Doug Burton, former floral and produce specialist (44 years with Acme and A&P); Carol Coombs, who spent 46 years with Acme in areas such as inventory control and DSD receiving coordinator; and Dorothy Hamilton, who spent 35 years with Acme in public affairs, government relations and customer relations.
According to Perkins, the new Mid-Atlantic team will focus on five distinct strategies:
*Create a selling culture where associates are energized, excited, motivated and have fun delighting customers.
*Accelerating top line sales growth by building the basket, driving more customers in stores, selling more units, and growing e-commerce and Own Brands business.
*Improve gross margin, lowering shrink and leveraging the distribution center.
*Leverage and lower expenses by focusing on productivity, reducing accidents, leveraging new contracts.
*Enhancing overall culture where everyone is celebrated, has equal access to opportunities and resources, and can contribute to their own and the company’s success.
The Mid-Atlantic division will encompass 275 stores and over 30,000 associates (approximately 285 at headquarters) in eight states stretching from Connecticut to Virginia. Annual sales will be approximately $6 billion. The Mid-Atlantic division will become the second largest operating unit of Albertsons.
The former Safeway headquarters in Lanham, MD will continue to operate as a regional office. It will house the liquor and floral sales managers as well as store operations and administrative personnel connected to those jobs.
The announcement of the Mid-Atlantic division’s leadership team follows a related move earlier this year when the two Albertsons division combined its warehousing and logistics responsibilities from Safeway’s distribution center in Upper Marlboro, MD to Acme’s larger mechanized depot in Denver, PA, near Lancaster. That transition was completed about six weeks ago.
Ex-Rite Aid CEO Standley Joins Walgreens As President
After a long tenure as chief executive of Rite Aid which ended last year, rival Walgreens Boots Alliance, Inc. (WBA) has named John Standley of president of the global firm’s Walgreens drug unit August 31. In his new post, he will lead all Walgreens operations, and will have responsibility for the development, growth and management of the business as the company continues to build on its leadership in the rapidly evolving healthcare sector.
WBA hopes that Standley, who first joined Rite Aid in 2007, will bring extensive operational experience to his role to further deliver on the company’s four key strategic priorities: creating neighborhood health destinations, driving cost transformation, accelerating digitalization and restructuring Walgreens retail offering. He will report to Alex Gourlay, co-chief operating officer of Walgreens Boots Alliance.
Standley’s new job was most recently held by Richard Ashworth who left in June to become CEO of Tivity Health, a Franklin, TN-based health and fitness organization. Ashworth, who had been with Walgreens for 28 years, was promoted to the president’s post in February 2020. He was previously VP-operations.
Additionally, WBA chief executive Stefano Pessina announced in July that he would leave his current post after a search is completed for a new CEO and a search was under way for a successor. At that time, Pessina is slated to become executive chairman. Current executive chairman James Skinner would remain of WBA’s board as a director.
“I’m very excited to join the team and lead the iconic Walgreens brand,” Standley said in a statement. “I’m looking forward to accelerating execution of the strategic vision for the future of Walgreens. My top priorities will be meeting and exceeding the needs of our customers, patients, team members and the communities we serve during these challenging times and ensuring that Walgreens fulfills its full potential as one of America’s most admired and trusted companies.”
Prior to two stints at Rite Aid Corp. (1999-2005 and 2008-2019, Standley was the chief executive officer of Pathmark Stores and has held leadership roles with Yucaipa Cos., (Fred Meyer Inc., Ralphs Grocery Co., Fred Meyer and Smith’s Food & Drug) and Fleming.
“John’s leadership experience and strong understanding of our industry and the U.S. health care markets will allow him to hit the ground running, drive our transformation and fulfill our purpose to help people lead healthier and happier lives across America,” stated Stefano Pessina, executive vice chairman and CEO of Walgreens Boots Alliance. “Walgreens’ essential role in the health care delivery system and in the lives of millions of Americans has never been more important as we continue to work our way through the pandemic together. I’m confident John will build on and grow our momentum at Walgreens and help us compete and win even more in the marketplace.”
Pessina and Standley know each other well from Walgreens’ failed attempt to buy Rite Aid in 2017 that was rebuffed by the Federal Trade commission. The two leaders re-engaged 18 months later, cutting an FTC-approved deal in which Walgreens would acquire nearly 2,000 Rite Aid stores nationally.
After that transaction was agreed to, Rite Aid sought to merge with supermarket chain Albertsons. That deal fell apart because of weak stockholder interest.
Standley becomes part of a team that faces some financial challenges, not unlike the ones he faced at Rite Aid. The company, based in Deerfield, IL, has seen the value of its stock plummet nearly 60 percent since 2016 and an attempt to go private through a $70 billion leveraged buyout late last year never gained any steam. At closing on September 2, WBA was trading at $37.17 per share. On September 2, 2015, WBA’s share price was $84.03
Lidl Will Invest $500M+ To Open 50 New Stores By End Of 2021
Lidl said it plans to invest more than $500 million to open 50 new stores in nine states by the end of 2021.
The stores, which will bring Lidl’s U.S. footprint up more than 150 locations, will be located in Delaware, Maryland, Virginia, New Jersey, New York, Pennsylvania, North Carolina, South Carolina and Georgia.
Some of the 50 stores include units Lidl acquired in two recent acquisition deals. In January 2019, it purchased 27 Best Markets locations, including 26 stores in New York (24 in Long Island, one in Astoria, Queens and one in Manhattan) and one in Holmdel, NJ (since closed). Then, in December 2019, Lidl acquired six Shoppers Food & Pharmacy stores in Maryland and Virginia from UNFI. Additionally, two of the planned new store openings are company-owned sites that were going to be part of the initial 100 stores Lidl originally planned to open in 2017 or 2018.
The Arlington, VA-based U.S. division of the large German chain also said it will close two stores in Havelock and Shelby, NC which originally opened in 2017.
In researching the new store list, we found about 25 percent of the stores (not including the Best Market and Shoppers acquisitions) are in towns/cities where Lidl originally planned to debut in 2017 and 2018, but did not open at the original site it planned.
Here is the list of new stores:
- 37th St., Astoria, NY*
- Larkfield Rd., East Northport, NY*
- Dogwood Ave., Franklin Square, NY*
- Middle Country Rd., Lake Grove, NY*
- Merrick Rd., Massapequa, NY*
- Sunrise Hwy., Oakdale, NY*
- Harbor View Marketplace, Bayonne, NJ
- Hooper Ave., Brick, NJ
- Fire Rd., Egg Harbor Township, NJ
- South Ave., Garwood, NJ
- Delsea Drive, Glassboro, NJ
- Blackwood, Gloucester Township, NJ
- Brunswick Pike, Lawrenceville, NJ
- Kinderkamack Rd., Park Ridge, NJ
- Park Ave., Weehawken, NJ
- Georges Ave., Woodbridge, NJ
- Baltimore Ave., Clifton Heights, PA
- Columbia Ave., Lancaster, PA
- Roosevelt Blvd., Philadelphia, PA
- York Rd., Warminster, PA#
- Pulaski Hwy., Bear, DE
- Solomons Island Rd., Annapolis, MD+
- Ritchie Hwy., Brooklyn Park, MD+
- Little Patuxent Pkwy., Columbia, MD
- Ritchie Hwy., Glen Burnie, MD
- Patrick St., Frederick, MD
- Montgomery Village Ave., Montgomery Village, MD
- Livingston Rd., Oxon Hill, MD+
- New Hampshire Ave., Takoma Park, MD+
- Padonia Rd., Timonium, MD
- Randolph Rd., Wheaton, MD+
- Little River Turnpike., Alexandria, VA
- Olde Keene Mill Road., Burke, VA+
- Chantilly Crossing Ln., Chantilly, VA
- Twentyninth Place Ct., Charlottesville, VA
- Gallows Rd., Falls Church, VA
- Liberia Ave., Manassas, VA
- Leesburg Pike, Sterling, VA
- Apex Peakway, Apex, NC
- S Church St., Burlington, NC
- S Tryon St., Charlotte, NC
- West Mallard Creek Church Rd., Charlotte, NC#
- Oleander Dr., Wilmington, NC
- Dorchester Rd., North Charleston, SC
- Peachtree Industrial Blvd., Duluth, GA
- Mount Vernon Rd., Dunwoody, GA
- Johnson Ferry Rd., East Cobb, GA
- Whitlock Ave SW., Marietta, GA
- Roswell Rd., Sandy Springs, GA
- Bells Ferry Rd., Woodstock, GA
*acquired from Best Markets in January 2019
+former Shoppers Food & Pharmacy stores acquired from UNFI in December 2019
#Lidl-owned stores that were listed on company’s original 2017 store plan
Kings Files Voluntary Chapter 11 Petition; ‘Stalking Horse’ Bidder Offers $75 Million
On August 23, KB US Holdings, parent company of Kings Food Markets, the Parsippany, NJ-based regional upscale chain, filed for Chapter 11 protection in the U.S. Bankruptcy Court for the Southern District of New York. The bankruptcy petition is a voluntary one and the court has accepted a “stalking horse” bid from investment firm TLI Bedrock to acquire 25 Kings and 10 Balducci’s stores for $75 million.
As part of the process, higher and better bids will be solicited, following the approval of bidding procedures under Section 363 of the U.S. Bankruptcy Code.
Additionally, KB has obtained a commitment for approximately $20 million in debtor-in-possession (DIP) financing from its existing secured lender, Whitehorse Capital Management LLC.
Upon bankruptcy court approval, the new financing, combined with cash generated from the company’s ongoing operations, will be used to support the business throughout the sale process. KB has sufficient liquidity to meet its go-forward business obligations and will operate its business as usual and pay its business partners for goods and services provided on or after August 23, 2020, the Chapter 11 filing date.
KB US Holdings, whose parent firm is GSSG Capital and is based in Qatar, acquired Kings in 2016 from private equity firm Angelo Gordon & Co. and MTN Capital.
“We are pleased to be moving forward with a sale so we can position Kings and Balducci’s for even greater long-term success. During this COVID crisis, our associates and communities have demonstrated not only the viability but absolute necessity of our markets in their communities. Our sales and service have never been stronger; we are confident we will emerge from this process without missing a beat, well-positioned for future stability and success,” said Judy Spires, CEO of KB US Holdings, Inc.
“We believe there is a unique place for essential stores with long-standing roots in their communities. We are seeking to invest in the opportunity for these stores to serve their local markets well,” said a statement released from TLI Bedrock.
Kings currently employs approximately 3,000 associates. Sales for the 52-week period ended on July 25, 2020 were about $590 million.
TLI Bedrock is a Manhattan-based investment firm that, according to its website, “is a multi-strategy fund that invests across sector and industry. It seeks high returns by backing innovative projects, responsible companies who think broadly about customer, employee and community needs, and sustainable approaches to commerce. TLI stands for trust, loyalty, integrity and serves as a guiding principle for the fund.” The company’s primary owner is Lawrence Benenson, who is part of Benenson Capital Partners, a long-established real estate investment firm based in New York.
Andrew Siegel serves as managing partner of the firm. Siegel, who joined TLI Bedrock in 2018, was a founding partner of Advance Venture Partners, the investment fund of global media company Advance Publications, Inc. He joined Advance in 2010, and as EVP-strategy and corporate development, was responsible for growth initiatives at the holding company and its operating units including Conde Nast.
Kings/Balducci’s challenges date back several years. And while more upscale retailers have entered Kings’ marketing area (primarily Central and Northern New Jersey) over the past 15 years (including Wegmans, Whole Foods, The Fresh Market and more upscale ShopRites, the market leader), many of Kings challenges have been internal.
“Kings possesses wonderful locations and is very good at marketing its image,” said a senior VP for a New Jersey-based retailer that competes against Kings. “But for many years they have not been competitive on price. When Kings was the only high-end, perishables-oriented retailer in their marketing area, they dominated that niche. But new retailers who offer many of the same products and services and are larger in size have penetrated the market in recent years, and when you couple that with lack of adequate financing with several ownership groups, you can see how Kings has struggled.”
Spires agreed that lack of capital has hindered Kings’ ability to grow, but the veteran retail executive believes that the filing of the voluntary Chapter 11 petition will allow the prospective new owners to provide Kings/Balducci’s the financial flexibility to move forward in a more competitive manner.
Kings’ financial difficulties can be seen in its most recent filing for the 52-week period ended July 25, 2020. While sales at its 35 stores were approximately $590 million, the retailer posted an $8.6 million loss even during the COVID pandemic when virtually all food retailers experienced very healthy sales and earnings. However, pre-COVID sales were soft, and the huge financial obligations Kings faced prevented the upscale merchant from adequately investing in its operations. Kings debt level is currently more than $110 million.
The Chapter 11 filing is not surprising since Kings has been working with investment advisor PJ Solomon to explore its sales options for about 18 months since a prospectus was issued. PJ Solomon will continue to work with Kings during the bankruptcy process. In the bankruptcy filing, PJ Solomon said it had contacted 114 potential purchasers, 67 of which signed non-disclosure agreements enabling them to receive further information. From that group, four parties continued to show interest before TLI Bedrock’s offer as a stalking-horse was accepted in July.
Also included in the bankruptcy data is the desire of KB/Kings to end the Chapter 11 process quickly, seeking an auction by October 8 and having a confirmation plan in place by December 18.
The urgency of an expedited plan was also noted by the retailer in the filing: “The debtors believe that if they cannot achieve a free and clear sale within the required time period prescribed by the milestones, all of the value created and preserved through the prepetition sale process will be lost, and the debtors could be left with no choice but to liquidate their business in a fire sale and piecemeal fashion.”
