Even food stores thought to be immune from the threat of Amazon are at risk. N.Y. supermarket chain Tops Markets filed for bankruptcy citing an unsustainable debt load, falling food prices and stiff competition from Amazon.com and other low-cost rivals forcing the supermarket chain to reorganize.
Tops said it expects the 169 stores it operates in upstate New York, Pennsylvania and Vermont to remain open while it restructures under Chapter 11 of the U.S. bankruptcy code in White Plains, New York. The chain has arranged for $265 million of financing while it completes the reorganization process.
The chain was founded by Armand Castellani in the 1920s, and the chain consisted of 15 franchise stores in 1962. By 1991, the chain has grown to 145 stores and was purchased by Ahold, a major international food retailer based in the Netherlands. In 2007, a private equity arm of Morgan Stanley purchased Tops Markets. During and after the Great Recession, the chain struggled, exiting 46 locations in Northeast Ohio. During 2012-2014, a number of stores in New York were downsized as the chain continued to struggle under $720 million of debt from the Morgan Stanley purchase.