Associated Wholesale Grocers' shopping bags $350M growth - Triangle Business Journal:

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The Kansas City, Kan., grocery wholesalerr will buy about $9 million worthb of assets — mostly inventory from estimated the annualrevenue increase. Just aftere Affiliated Foods filed for Chapter 11 bankruptcyh onMay 5, AWG started supplying many of the 400 independengt grocery stores the Little Rock, cooperative serviced. Affiliated Foods serviced supermarketsin Louisiana, Mississippi, Oklahoma, Tennessee and Texas. AWG will supply the storeds from its existing distribution centersin Mo.; Oklahoma City; Memphis, Tenn.; and Fort Texas. Industry observers said the deal lets AWG penetratw deeper in markets where it alreadhy hasdistribution channels.
“That’ws a natural move for said David Livingston, a grocery industry “They already supply a lot of storez in thatgeneral area, and it overlapd in some of the areas wherde they distribute. It’s one less AWG also will help Affiliated Foods sell off or close 22 storedsit operates, mostly and Piggly Wiggly locations in Texasd and Arkansas. Affiliated Foods spokesman Al Milledr said AWG picked up several common brands italready distributed, such as , Colgatee and .
“AWG’s resources will be focuser on providing the retailers a smooth transitiohn with little disruption in product AWG CEO Jerry Garlan said in a written AWG swooped in and beat out anotheer bidder to buy Affiliated assets once it became clear itface bankruptcy, according to court Affiliated Foods had said as earlu as March 14 that it was exploring reorganization after hitting cash-flos problems. Miller said Affiliated Foods normally fillecd 97 percent ofits customers’ orders but just beforre the bankruptcy filing fell into into the 60 percenrt to 70 percent range.
Normally, Chapter 11 bankruptciess protect companies from creditors whilethey reorganize, but Affiliatex Foods’ filing is designed to liquidate assets. Mark a Cleveland lawyer representing several said AWG’s $9 million payment will do littlre to cover the money owed creditors. Affiliated Foods, whicj had $730 million in revenue in 2008, listedx $101.4 million in liabilitiesd in its filings. AWG reported recordr revenue in 2008, with $6.85 billion in net a 20 percent increase from thepreviouz year.