The company will seek bankruptcy court approval on Friday to sell virtually all of its assets to the affiliate of Los Angeles-based Yucaipa, according to court documents filed Nov. 15 in Wilmington, Del.
Under the proposed deal, a Tesco affiliate would lend the Yucaipa unit $120 million to help finance the acquisition, according to court papers. Tesco would get warrants to buy as much as 10% of the reorganized chain's equity, while Fresh & Easy would get a 22.5% stake.
Yucaipa has agreed to take over about 150 of the markets along with the production facility in Riverside, where the company produces meals under the Fresh & Easy brand. Fresh & Easy operates 167 stores in the western United States.
The supermarket chain, based in El Segundo, sought bankruptcy protection Sept. 30, listing debt of as much as $1 billion and assets of as much as $500 million.
