The company that drove Dean & Deluca into bankruptcy is offering $10 million for another shot at running the gourmet grocer, the New York Post reported. Thailand-based real estate company, Pace Development, which sunk millions into a failed Dean & Deluca expansion before filing for chapter 11 protection in April, outlined its plan for a second chance in a Manhattan federal court filing this week. The plan calls for $5 million of a $10 million investment to be used to pay off $26.5 million owed to vendors and other creditors, court papers show. The company didn’t say what it will do with the remaining $5 million, but it will presumably use the money to relaunch stores, experts said. “Dean & Deluca over expanded and lost what made them special,” said distressed debt experty Adam Stein Sapir. “But if they can bring it back to its former glory with a smaller footprint, it has a lot of potential.” The company, founded in Manhattan’s Soho neighborhood in 1977, filed for bankruptcy protection on March 31 at the start of the coronavirus pandemic. But its problems started well before then. After buying the grocery for $140 million in 2014, Pace plowed $240 million into expanding it around the world at a time of growing competition in the gourmet food industry. By 2018, upscale vendors like Ceci Cela Patisserie and Elenis bakery had sued Dean & Deluca for not paying its bills, and by mid-2019 Pace shuttered all of its owned retail outlets and its e-commerce website. By last year, the company’s franchisee-owned stores were its only source of income — but even that spigot has dried up, the filing said. Just two stores, both in Honolulu, remain open and neither has paid Pace royalty fees for months, the company lamented.
