Aug. 14, 2007 — The parent company of the Pueblo supermarkets filed for debt protection with U.S. Bankruptcy Court in Delaware earlier this month, leaving V.I.-run businesses scrambling to recover nearly $450,000, according to documents obtained by the Source.
Chapter 11 debt protection means the company will stop operations and sell whatever it can to repay its creditors, but not necessarily all debts will be paid.
"It's a bad scene," said Fred Hintz, president of St. Thomas' Trans-Caribbean Dairy Corporation, which Pueblo owes nearly $80,000. "Of course we're worried about collecting on that. It may be a serious enough issue that it may force us out of business."
Pueblo had been paying their bills a week or two behind until late July, when the money stopped, Hintz said.
Now the dairy has filed legal motions totaling about 40 pounds in paper trying to recoup the money, he said.
The bankruptcy filings show the supermarkets owe more than 200 creditors a total of more than $100 million, and have somewhere between $1 million and $100 million in assets.
The Puerto Rico and Virgin Islands supermarkets are owned by Pompano Beach, Florida-based FLBN, LLC; FDBA FLBN Corporation; and FDBA Xtra Superfoods Centers, Inc., which filed for Chapter 11 bankruptcy Aug. 3. The company is also affiliated with Nutritional Sourcing Corporation, Pueblo International LLC, and a host of other names.
Nutritional Sourcing also filed bankruptcy in 2002, owing PAM Capital Funding LP, Barclays Bank PLC and ML CBO IV Ltd. more than $23 million.
Among private debts listed in the August bankruptcy filing, the company owes the largest amount to Washington-based Pension Benefit Guaranty Corporation, then a Florida-based supplier.
But third on the list is Food Warehouse Corporation of Peter's Rest, St. Croix, which Pueblo owes $171,581.
The supermarkets owe St. Thomas-based Bellows International $82,725.
St. Thomas-based Florida Coca Cola Bottling Co. is owed nearly $40,000, the West Indies Corp is owed more than $36,000, Caribbean Healthway Distributors is owed nearly $23,000 and Premier Wine & Spirits is owed more than $18,000.
The people of the Virgin Islands will also have to try and get money out of the failed business: Pueblo owes the V.I. Bureau of Internal Revenue more than $146,000 and the V.I. Water and Power Authority nearly $142,000.
The amount owed to V.I. companies is paltry compared to the millions Puerto Rico-based suppliers will have to try to recoup.
The four Virgin Islands Pueblo stores were reportedly sold to World Fresh Market in July. (See "Pueblo Supermarkets to be Sold to World Fresh Market"),
Company officials did not return phone messages left Monday asking for comment on the bankruptcy proceedings.
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