Santa Clarita grocer Haggen has announced that it is filing for bankruptcy protection today after struggling to win over customers and build business at their 164 stores. The filing for corporate reorganization under Chapter 11 comes as the company secures $215 Million in debtor-in-possession financing from existing creditors.
Haggen has previously announced that it will be closing their store on McBean Parkway (formerly Pavilions) as part of a cost cutting move.
“After careful consideration of all alternatives, the company concluded that a reorganization through the Chapter 11 process is the best way for Haggen to preserve value for all stakeholders,” said John Clougher, Chief Executive Officer of Haggen in a press release. “The action we are taking today will allow us to continue to serve our customers and communities while providing Haggen with a process to re-align our operations to be positioned for the future.”
The chain has requested in its filing for the court to allow its operations as normal during the reorganization, ensuring that employees wages and beneits will be retained, and customer loyalty programs are honored.
Haggen is currently suing Albertsons for $1 Billion alleging that their actions during and following the sale of some of their stores to Haggen precipitated this move to bankruptcy.