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Following Schumer Demand, Penn Traffic Dropped Push for Low-Ball Liquidation Bid That Will Shutter Stores and Toss Workers Out; Bids Have Been Submitted That Will Save Most of the Stores and Jobs

Last Week, Schumer Sent Letter To Penn Traffic and Their Main Creditor, GE Capital, Strongly Opposing the Liquidation Bid and Urging All Parties to Adhere to January 22nd Deadline to Submit Bids That Will Keep the Most Jobs and Stores; Earlier, Schumer Secured Extra Time From GE Capital t

U.S. Senator Charles E. Schumer today held a rally with Penn Traffic Employees to discuss the state of play of the Penn Traffic bankruptcy process and continue to press all parties to select a bid that will save the greatest number of stores and jobs. Schumer said that bids have been submitted that will save the vast majority of jobs and stores, and that this is good news, but there is more work to do.  Last week, Schumer urged the major players in the Penn Traffic negotiations to not accept any lowball liquidation bids offered and instead to prioritize bids that maximize the greatest number of jobs retained and stores kept open. Schumer strongly urged all interested parties to utilize the full time available - to January 22nd - to submit going concern bids.
A bankruptcy judge is currently evaluating the various bids and is likely to make a decision on a stalking horse bidder today or early this week. 
"We are not across the goal line yet, but it looks like the components are all coming together to save thousands of jobs and dozens of grocery stores in Jamestown and across Upstate New York," said Schumer.  "We have already seen some very competitive bids- bids that would likely save all the jobs and stores in New York - that will most likely gain key levels of formal acceptance.  I think that all parties understand that selecting a bid that would keep the most stores open and operating is the right thing to do, and I think we are headed in that direction."
Schumer has been a strong advocate for employees and customers of supermarkets owned by Penn Traffic.  He successfully secured an additional month for companies to bid on Penn Traffic locations to allow the company to sell as many stores as possible.   The senator was concerned that the possibility of liquidation - and the immediate shuttering of store doors at scores of locations, and workers tossed out at Christmas time - loomed as an alltooreal possibility for upstate workers and consumers.  Previously, the deadline to submit bids had been December 21st.  However, two weeks ago GE confirmed that the deadline to submit bids would be extended to January 20th or 21st with the goal of having a deal wrapped up by January 31st.
Schumer said that in the interests of consumers, workers and the people of New York, it is urgent that interested parties forge a deal that maximizes the numbers of workers retained and stores kept open.
Penn Traffic operates stores in a number of rural locations where they are the only provider of groceries. Many communities would face commutes of an hour or more to find grocery stores without Penn Traffic.   Penn Traffic has 76 stores, 53 of which are in NYS. They have 6,000 employees, roughly 4,000 are in NYS. The head of the lending group is GE Capital, who had originally considered liquidating all of Penn Traffic's stores on December 30th. All 6,000 employees would have been fired in such a scenario.