A&P to Receive $490 Million as Part of Reorganization

The Great Atlantic & Pacific Tea Company Inc. (A&P, Montvale, N.J.) has entered into an agreement to receive $490 million of debt and equity financing from private investors comprised of The Yucaipa Companies LLC, Mount Kellett Capital Management LP and investment funds managed by Goldman Sachs Asset Management, L.P.

The agreement, which is subject to approval of the U.S. Bankruptcy Court for the Southern District of New York, will enable A&P to complete the restructuring of its balance sheet and emerge from Chapter 11 as a private entity in early 2012.

“This investment commitment is a very important step in A&P’s financial and operational turnaround,” says A&P’s president and ceo Sam Martin. “It positions us for a bright future with solid financial backing from sophisticated investors who know our company and industry well, and who also share our vision for A&P’s future.”

Following the closing of the transaction and the company’s emergence from Chapter 11, the company plans to dissolve its current Board of Directors and appoint a new one.

A&P and its subsidiaries filed voluntary Chapter 11 petitions in December 2010. The company operates 336 stores in seven states under the banners A&P, Waldbaum's, Pathmark, Best Cellars, The Food Emporium, Super Foodmart, Superfresh and Food Basics.