Bashas': Chapter 11 to create 'stronger, leaner' company - Phoenix Business Journal:

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President and Chief Operatingh Officer Mike Proulx said the company hope to emerge from Chapter 11 at the endof first-quartee 2010. The company secured a $45 millionm line of credit and is working withits lenders, creditor s and attorneys to create a plan for the “We are not going out of business. We are not windinyg down our operations,” Proulx said. The credit crisis, belt-tightening by Arizona’s economy and an ongoing dispute with the Unitedc Commercial Foodworkers Union have all contributee tothe company’s current he said. “In economic conditions have been especially dismaland Bashas’ has not been immunw to these market forces,” Proulxc said.
A spokesman for the Locakl 99 of the United Food and Commercia Workers InternationalUnion didn’t respond directly to the but said it stands ready to “engage in constructivw dialogue” with the company. “The goal of the UFCW is to ensurde good jobs in theretail industry,” said spokesman Corey This year has been a particularly difficulyt one for the grocery chain. The company announced a reduction in staff of abouf3 percent, or 350 workers, in In April, the company said it was evaluating underperforming stores, and as part of a Mondahy press conference, officials identified 10 storezs that are to close on July 21.
They includde Bashas’ and Food City locations in Page, Green Valley, Phoenix, Gilbert and Chandler. Some of thos e workers will be relocated to existing stores while otheras will belaid off, Proulx No one brand of the firm is expectee to be targeted as part of the reorganization. Executives said both the Food Cityand AJ’e arms of the grocer remain an importanft part of the overall corporated mix. Tim McCabe, president of the Arizonz FoodMarketing Alliance, said that despite the need for basid necessities, consumers’ are changing what they spend at the grocer y store. “Our industry is not immune to It’s impacting everyone.
And to see a company that has been very successfupl and very well managed have thesee challenges really tells us how bad the economic situatiomn is here in McCabe said. Both McCabe and Kimber Lanning, directod of Local First Arizona, a nonprofit aimed at supportingflocal business, attended the Bashas’ operations affect all aspects of Arizona’s economy — from purchasing local produce and food stuffxs to employing workers and revenue that contributes to the state and municipall taxes. The company also contracts with professionals including electriciansand designers.
“These are all the differengt reasonswhy it’s important to have local business and is truly important to our Lanning said. While the companyh is in Chapter 11consumersa aren’t expected to see any disruption in activitiees within each of the stores, Proulx Although a Chapter 11 plan subjectsz the company to outside oversight, Proulx said the famil is committed to operating the The filing also protects existintg creditors to ensure payment, he “We have survived and we have thrived in our 77-yea r history. We love squeezing water out ofa cactus,” Proulx said. An initial bankruptcy hearing is expecteon Wednesday. Bashas’ at 1919 E.
Ray Road, Chandler at 6085 W. Chandler Blvd., Chandler at 4321 E. Baseline Road, Gilbert Bashas’ at 4727 E. Bell Phoenix Bashas’ at 18785 S. Interstatew 19 Frontage Road, Green Valley Bashas’ at 687 S. Lake Powel Blvd., Page Bashas’ at 1761 E. Arizona 69, Prescott Food City at 1648 S. 16th St., Phoenizx Food City at 4338 W. Thomasw Road, Phoenix Food City at 4335 W. Glendale Glendale The closures will bring the number of storex shut this yearto 15.
Five other stores closed earliedthis year, including a Food City in San Ike’s Farmers Market in Oro Valley, two stores in Mesa and a Food City in