New York City, Supermarket operator Winn-Dixie Stores Inc., along with 23 of its U.S. subsidiaries, filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code. The company, whose 920 stores remained open for business, said it had lined an $800 million debtor-in-possession financing facility from Wachovia Bank, which replaces its previous $600 million credit line.
Winn-Dixie has been widely expected to file Chapter 11 after it posted a larger-than-expected quarterly loss earlier this month. The grocer has been struggling under intense competition from Wal-Mart and other rivals. Speculation heated up again last week that a filing was on the way after the chain said it had incorrectly calculated a measure of earnings.
The retailer said that as part of its Chapter 11 restructuring, it would seek additional asset sales and cut expenses. It also said it is taking steps to reduce its lease obligations on previously closed stores.