Alabama grocery conglomerate – Belle Foods – filed for bankruptcy law protection under Chapter 11 of the Bankruptcy Code, citing excessive debt and insufficient cash flow as the cause of its financial strain.
The company, which once operated the former Bruno’s and Food World stores, said it was finding it difficult to meet its creditor obligations with revenue from its 57 stores in Alabama, Georgia, Florida, and Mississippi. Belle Foods acquired the stores from Southern Family Markets, the company that took control of a number of Bruno’s and Food World chains, according to AL.com.
As a result of the purchase, Belle Foods still owes Southern Family Markets $4 million for a loan and $24 million in a revolving line of credit. Belle Foods also owes C&S Wholesale Grocers $5.1 million in accounts payable and $900,000 on a pension withdrawal liability note, the news source reports. The company listed $8 million in other accounts payable due.
In its bankruptcy filing with the U.S. Bankruptcy Court for the Northern District of Alabama, the company cited technical difficulties with its accounting system and poor structuring of lending and creditor relationships as contributing factors to its bankruptcy.
“Additionally, higher payroll taxes in 2013 have led to a decline in purchases by the (Belle’s) customer base,” the filing said. “Furthermore, (Belle) has also seen an increased amount of competition in several of its markets from other grocers. With older locations, Debtor has had difficulty competing with the newer grocery stores that have moved into its markets.”
The Associated Press reports that the company attempted to shave costs in April by hiring 300 part-time workers to replace full-time staff. However, 34 percent of the company’s workforce is full-time, and a large percentage are union workers, who have collective bargaining agreements with United Food and Commercial Workers 1996 and 1529 and the Retail, Wholesale and Department Store Union.
The Current Administration's Proposals for the Financial Services and Banking Industries Will Affect Your Business
Since his inauguration two months ago, Donald Trump’s administration and the Congress it controls have indicated important upcoming policy changes. These changes will impact financial services policies and priorities. The changes will particularly affect cryptocurrency, as well as banking rules and regulations. Key Regulatory Changes in Cryptocurrency For example, in the burgeoning cryptocurrency business environment, […]
Tips for Commercial Landlords Impacted by Wave of Retailer Bankruptcies Part 1
The retail sector has experienced a wave of bankruptcy filings over the last year. Brick-and-mortar businesses in financial distress include big-name brands like Big Lots, Party City, The Container Store, and Vitamin Shoppe. When large retailers seek bankruptcy protection, they are not the only businesses impacted. Landlords can be particularly hard hit. While commercial landlords […]
How Understanding Bankruptcy Trends Can Benefit Your Business
The bankruptcy legal landscape presents both challenges and opportunities for businesses navigating financial distress. Understanding current bankruptcy trends can help businesses make more informed and strategic decisions. Corporate Bankruptcy Filings Trending Upwards Bankruptcy filings continued to trend upwards in 2024. According to statistics released by the Administrative Office of the U.S. Courts, personal and business […]
SEC Takes Actions Against Issuers for Failure to File Form D
In December, the U.S. Securities and Exchange Commission (SEC) announced charges against two privately held companies for failing to file a Form D notice, which is generally utilized for exempt securities offerings. Here, the SEC’s enforcement sends a strong message: compliance with regulatory requirements is not optional and failure to comply can have significant consequences. […]
Redefining Labor Relations: NLRB's Pivot from Abruzzo’s Memoranda
On February 14, 2025, the Office of General Counsel (OGC) of the National Labor Relations Board (NLRB) under Acting General Counsel William B. Cowen issued Memorandum 25-05, “New Process for More Efficient, Effective, Accessible and Transparent Case handling.” The Memorandum rescinds nearly all of the Memoranda issued by his direct predecessor, Jennifer Abruzzo, setting the […]
If you purchase real property from a foreign person or entity, you may be required to withhold taxes from your payment to the seller under the Foreign Investment in Real Property Tax Act (FIRPTA). The federal tax law is designed to ensure that foreign sellers pay any applicable capital gains tax on profits realized from […]
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.
Let`s get in touch!
Sign up to get the latest from the Scarinci Hollenbeck, LLC attorneys!
