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Updated: Lucky’s Market To Sell 11 Stores, Begins Chapter 11 Proceedings

Lucky's Market Asset Purchase Agreements

Lucky’s Markets has agreed to sell various ongoing stores to its founders, Bo and Trish Sharon, who will be a stalking horse in the Lucky’s Chapter 11 process which was filed earlier this week, according to a Jan. 30 statement by investment banking advisor PJ Solomon. 

On Jan. 27, the Niwot, Colorado-based natural foods chain had announced that it would continue to operate seven of its locations, including its markets in Traverse City, Michigan; Cleveland, Ohio; Columbus, Ohio; Columbia, Missouri; Melbourne, Florida; North Boulder and Fort Collins, Colorado.

Lucky’s also had agreed to sell various other stores to Aldi and Publix as stalking horse bidders earlier this week. The transactions will be subject to a court-supervised auction process and will include a sale process for Lucky’s remaining store locations.  

The stores in these three transactions employ nearly 2,000 people.  

PJ Solomon is acting as M&A investment banking advisor to Lucky’s on the transactions.

On Jan. 21, the company disclosed that it would be closing its remaining stores. After careful deliberation and a thorough review of strategic and financial alternatives, the company decided to voluntarily file for Chapter 11 protection to facilitate the sale of its remaining assets and signed Asset Purchase Agreements with Aldi for five leased store properties and the purchase of one owned property and with Publix Super Markets Inc. for five leased store properties. The company continues to have active dialogue with various buyers.

The company still plans to cease operations in the 32 identified locations in the coming weeks and is currently running sales for its customers in those stores.

The Asset Purchase Agreements are subject to court approval and an overbidding process. The company has retained PJ Solomon to assist it in the sales of these and other assets.

At the time of filing, the company had sufficient cash on hand and an agreement for the consensual use of cash collateral. As such, the company should have the continued ability to meet its financial obligations, including those to its employees, as well as to vendors for the continued supply of product to its operating locations.

In addition to PJ Solomon as its investment banker, Polsinelli is serving as the company’s legal counsel and Alvarez & Marsal is serving as its restructuring advisor.

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