Winn-Dixie shutting stores
Six in South Florida to close; firm heading into bankruptcy.
Winn-Dixie parent company Southeastern Grocers will close 94 stores — including six in South Florida — and file for Chapter 11 bankruptcy reorganization as it tries to save its struggling grocery business, the company announced.
Southeastern’s group of grocery brands also includes Harvey’s and BI-LO. The chain has struggled with fierce grocery competition from Publix, Walmart and an increasing number of niche grocers, including Lucky’s Market and Sprouts. In the last three years, the company has changed leaders twice, revamped its pricing policy and changed its employee loyalty program while rebranding some of its stores and closing others.
Southeastern, which is based in Jacksonville, said it has reached a restructuring agreement with a group of creditors holding 80 percent of its debt, which comes due in September.
“The agreement we announced today is an important step in Southeastern Grocers’ transformation to put our company in the best position to succeed in the extremely competitive retail market in which we do business,” said a statement from president and CEO Anthony Hucker. “We are excited to emerge with the optimal store footprint and greater financial flexibility to invest in Southeastern Grocers’ growth.”
It would be the company’s third bankruptcy filing since 2005, each of which included store closures and layoffs.
The restructuring will leave Southeastern with 582 remaining stores. The company plans to emerge from bankruptcy within 90 days, it said.
The bankruptcy should help the company escape leases on several of its closing stores, according to the news release. Southeastern executives say the planned restructuring should put it in better financial position, including a $500 million reduction in debt.
“We expect our financial health and free cash flow to improve in the newly reorganized company, and although the restructuring contemplates certain store closings, SEG is committed to ensuring that all associates continue to be treated with the utmost dignity, respect and compassion,” Hucker said. “We will continue every day to provide our associates with a great place to work and our customers with a store experience they can count on.”