Court Approves AWI Acquisition By C&S Wholesale Grocers

As widely expected, C&S Wholesale Grocer’s bid to purchase Associated Wholesalers, Inc. (AWI) and its subsidiaries was approved in a sale order hearing by U.S. Bankruptcy Court Judge Kevin J. Carey.

Aside from Keene, N.H.-based C&S, Minneapolis-based Supervalu was also bidding for the assets of AWI – a regional co-op food distributor that operates two distribution centers in Pennsylvania, along with its White Rose subsidiary, which operates three distribution centers in New Jersey, and four corporate Nell’s Shurfine Markets.

C&S's winning auction bid – which was roughly $95 million more than its original “stalking horse” offer – was valued at $288 million, while Supervalu’s final bid was $284.6 million. The court decision puts to rest months of uncertainty among associates and trading partners of the Robesonia, Pa.-based AWI, which entered into Chapter 11 bankruptcy on Sept. 9, 2014, with C&S named as the stalking horse bidder.

The acquisition is expected to close on or around Nov. 11, and will include substantially all of AWI/White Rose’s assets as well as their 2,200 employees.

“We are excited to have the opportunity to partner with Associated Wholesalers’ and White Rose’s strong team and customer base of independent grocers,” said Rick Cohen, C&S chairman and CEO. “My grandfather founded C&S to supply independent retailers, and while we now proudly service grocers of all sizes, this transaction will give us an even greater capacity to provide the unique services required by independents and regional chains.”

“Our first priority is to provide exceptional service to the customers, especially as we approach the holiday season,” added Christopher Brown, C&S's newly appointed SVP of independent sales. “We are committed to maintaining and enhancing the services provided to the numerous retailers who have relied on AWI and White Rose for their grocery supply needs.”

Describing the auction process as "robust and competitive," Matt Saunders, AWI president/CEO, said, "We believe that the winning bid from C&S is in the best interest of AWI and its stakeholders. C&S shares AWI's commitment to providing customers and independent stores great deals on products and on helping them grow their businesses. AWI will further enhance C&S's position as the leading wholesale grocery supply company and we look forward to completing the sale."

Saunders expressed thanks to the employees of AWI and White Rose, "whose continued hard work and dedication enabled us to move through this process."

AWI and White Rose will continue to operate independently of C&S and will continue operating in the ordinary course until the transaction closes.

Court documents and additional information can be found at a dedicated website administrated by AWI's Claims Agent, Epiq Systems. Saul Ewing LLP and Rhoads & Sinon LLP are serving as legal advisors; Lazard Middle Market is serving as financial advisor; and Carl Marks Advisors is serving as AWI's restructuring advisor.

C&S is the largest wholesale grocery supply company in the U.S., supplying independent supermarkets, chain stores, military bases and other customers with more than 150,000 different products.  C&S serves about 5,000 stores from more than 50 locations across the country, including Stop & Shop, Giant Carlisle, Giant Landover, Bi-Lo/Winn-Dixie, A&P, Safeway and Target.

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