Associated Wholesalers Inc., a food distributor, filed for bankruptcy with a plan to sell its assets, citing “fierce competition” in the grocery supply business, Bloomberg News reported today. The company in chapter 11 papers filed in court yesterday listed as much as $100 million in debt and said that it planned to hold an auction with C&S Wholesale Grocers Inc. as the lead bidder. AWI listed some of the biggest U.S. brands as creditors, including Tyson, Kellogg, General Mills and ConAgra, each owed more than $2 million; and Smucker, Nestle, Kraft and Dannon, each owed more than $1 million. The company, whose White Rose unit also filed for bankruptcy, has been failing in part due to “compressed margins and fierce competition,” Chief Restructuring Officer Douglas Booth said in a court filing. In the planned sale, C&S will be the “stalking horse” or initial bidder in a court-supervised auction, subject to higher or better offers, AWI said. Booth said that AWI serves 800 supermarkets and other stores in the U.S. mid-Atlantic region, with about 1,400 employees.
