PARSIPPANY, NJ - The parent company of Kings Food Markets, a grocery chain which opened its first store in Summit more than 80 years ago, has filed for Chapter 11 proceeding in the U.S. Bankruptcy Court for the Southern District of New York. The filing by Parsippany-based KB US holdings, Inc. -- which also owns Balducci's Food Lover's Market -- follows a buyout offer from New York investment firm TLI Bedrock, LLC for $75 million.

Combined, KB US Holdings, Inc. operates 35 supermarkets -- 25 of which are Kings locations -- in New York, New Jersey, Connecticut, Virginia and Maryland and employs more than 2,100 people.

As noted on supermarketnews.com, "the company said it has sufficient liquidity to operate its business as usual and meet its business obligations going forward, including payments to vendor partners for goods and services after Aug. 23 Chapter 11 filing date."

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According to court documents filed on August 20, the parent of Kings Food Markets retained Ankura Consulting Group, LLC nearly two years ago to "provide KB financial advisory services in connection with KB's evaluation and development of strategic alternatives and to assist KB in its negotiations with creditors."

The filing asserts as a result of increasing competition in the highly competitive retail food industry, KB experienced lower earnings and increased debt as well as strains on the company's liquidity and cash flow. Thusly, KB has experienced multiple defaults and unable to pay regularly scheduled principal and interest payments to lenders since 2018. Outstanding debt obligations are approximately $114 million.

Though the COVID-19 pandemic increased sales, months leading up to the Chapter 11 cases "created unique challenges and pressures on the debtors and their senior management team", according to M. Benjamin Jones, Senior Managing Director of Ankura Consulting Group in the filing.

Kings was founded in 1936 and expanded over the years along the railroad lines in the New York City suburbs. It changed its name to Kings Food Markets in 2012. In addition to the Summit location at 784 Springfield Avenue, Kings Garden State stores can be found in Short Hills, Verona, Montclair, Maplewood, Livingston, Chatham, Hoboken, Morristown, Florham Park and several other townships.