Winn-Dixie seeks bankruptcy protection, debts rise to $1.87 bn - update 2

02/23/05 - newratings.com

NEW YORK, February 23 (newratings.com) – Winn-Dixie Stores Inc (WIN) has filed for bankruptcy protection, citing its widening losses and deteriorated liquidity position as the reasons. The company plans to reduce its expenses to seek additional asset sales during its reorganization process.

The US-based supermarket operator said in a statement on Tuesday that Winn-Dixie and 23 of its US subsidiaries filed for Chapter 11 bankruptcy protection in the US Bankruptcy Court for the Southern District of New York on Monday. The company said that its 920 Winn-Dixie stores would remain operational. The statement added that Winn-Dixie has secured a financing facility of $800 million from Wachovia Bank, replacing the company's previous credit facility of $600 million, to help pay for its reorganization process. Earlier this month, Winn-Dixie reported that its losses had widened to $399.7 million in the second quarter of the fiscal year. The company has listed total debts of $1.87 billion in its bankruptcy filing, while the US-based food giant, Kraft Foods, is the company's biggest creditor.