SCHUMER: PIECES OF THE PUZZLE ARE STARTING TO FALL INTO PLACE TO SAVE PENN TRAFFIC; HOLDS FINAL RALLY BEFORE TOMORROW'S PIVOTAL BANKRUPTCY HEARING TO PUSH BALL OVER THE GOAL LINE
Following Schumer Demand, Penn Traffic Has Agreed to Drop Push for Low-Ball Liquidation Bid That Will Shutter Stores and Toss Workers Out; Bids Have Been Reported That Will Save Most of the Stores and Jobs
This 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 G
U.S. Senator Charles E. Schumer today said that all the pieces are starting to fall into place to save Penn Traffic from liquidation, a fate that would shutter stores and throw thousands of people out of work. He said that in recent weeks significant progress has been made, and that the prospects look good that tomorrow's bankruptcy court hearing will result in a competitive, nonliquidation bid being selected.
Schumer said that Penn Traffic's decision to drop their ill advised request for an emergency motion to liquidate all of its assets at a courtordered auction was a tremendously positive step, and helped to avert thousands of lost jobs. After pressure by Schumer, Penn Traffic dropped their efforts for a quick liquidation. Schumer also said that it was good news that there are reports of competitive bids to save the vast majority - if not all - of the stores.
Today Schumer held a rally to with Penn Traffic employees in Rome, NY to continue to place pressure on all parties to save as many jobs and stores as possible. Schumer said we are at the 20 yard line, but we need to move the ball across the goal line.
"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 across Upstate New York," said Schumer. "I am optimistic that by the end of tomorrow we will see some very competitive bids - bids that would likely save all the jobs and stores in New York - come forward and perhaps gain key levels of formal acceptance. I think that all parties understand that selecting a bid the would keep the most stores open and operating is the right thing to do, and I think we are headed in that direction. Saving jobs is obviously urgent in this economic climate, but it is also important to preserve the maximum number of stores, as many of these grocery stores exist in communities with precious few food shopping options."
For the past weeks, Schumer has been fighting to help Penn Traffic come through the bankruptcy process with the greatest number of stores intact. Following Schumer's urging, Penn Traffic has dropped its push for a decision to be made by this Friday - well ahead of the previously established court date for bids of January 22 to allow the stores to be sold at an auction. After reports surfaced that Penn Traffic was pushing for this quick liquidation, Schumer urged the major players in the Penn Traffic negotiations not to accept any lowball liquidation bids offered by this Friday, and instead to prioritize bids that maximize the greatest number of jobs retained and stores kept open.
Schumer also 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 20 th or 21 st with the goal of having a deal wrapped up by January 31 st.
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.
