Winn-Dixie has been a staple in Jacksonville, Florida for decades! Being based in Jacksonville has even made it a landmark for those traveling down Interstate 10. However, Southeastern Grocers, the parent company of Winn-Dixie, Bi-Lo, Harveys Supermarket and Fresco Y Mas, made the enormously difficult decision to file for Chapter 11 Bankruptcy in hopes of remaining afloat. The decision was announced Thursday, March 15, 2018. Winn-Dixie’s president and chief executive officer, Anthony Hucker has been quoted saying “[t]his course of action enables us to continue writing the story for our company and our iconic, heritage banners in the Southeast.” Southeastern Grocers operates stores in Alabama, Florida, Georgia, Louisiana, Mississippi, North Carolina and South Carolina. This announcement comes right after Amazon’s entry into the grocery business, just a few short months after the online retail giant obtained Whole Foods Market.
Coming with the filing of a Chapter 11 Bankruptcy is the closing of 94 stores that are underperforming, 35 of which are in Florida and four of those are local to Jacksonville. After the bankruptcy, which should be completed within 90 days, there will be 582 stores remaining.
The object of a Chapter 11 Bankruptcy is very similar to that of a Chapter 13 Bankruptcy but is geared mostly to large corporations. A reorganization plan is submitted to the court for review and confirmation. Through the reorganization plan, debts can be renegotiated for more favorable terms, paid off or even discharged depending on what is in the best interests of the corporation and the priority of the debts. Chapter 13 Bankruptcy, also called a Reorganization Bankruptcy, is designed for debtors with steady income who can make regular payments towards their debts through a repayment plan. Some of the main benefits of a Chapter 13 Bankruptcy are the ability to catch up on missed debt payments, retaining personal property (including non-exempt assets) and nondischargeable priority debt payments.
For Winn-Dixie, this will hopefully mean they will no longer be liable for the leases on the stores that will be closing and an overall debt reduction of around $500 million.
Just like Winn-Dixie is proposing a payment plan to the court, individuals who file a Chapter 13 Bankruptcy do a similar thing. They have the option to break leases, walk-away from secured debts, and lower their over all debt. The biggest difference is how long a Chapter 13 Plan lasts versus a Chapter 11 Plan. A Chapter 13 Plan must last 60 months while a Chapter 11 is usually concluded within 18 months.
Making the decision to file for bankruptcy is not a easy one. If you are facing the prospect of filing for bankruptcy, you should first consult with an attorney who specializes in bankruptcy law to provide you with peace of mind and a clear path forward. The Law Office of David M. Goldman PLLC has guided hundreds of individuals through bankruptcy proceedings and takes an empathetic approach to working with its clients. Contact us today for a complementary consultation. (904) 685-1200