This is Why No One Should Bail Out the “Smart Money” Stuck in Brick-and-Mortar Retailers: Let them Shed their Own Tears

by Wolf Richter
Wolf Street

The toxic Safeway-Albertsons combo is waiting in the wings.

Late yesterday, Fairway Group Holdings, parent of Fairway Market – an “iconic New York food retailer,” as it calls itself, that had started out as a “veggie stand” in 1933 and now lists 18 stores on its website – crumpled under a pile of debt and filed for a prepackaged Chapter 11 bankruptcy. Almost exactly three years after its IPO!

Bankruptcy rumors have been swirling for a while. The company announced in February that it would need to raise capital in order to keep its doors open. April 15, Bloomberg reported that the company was negotiating a debt restructuring with its creditors, and that a deal was near for a prepackaged Chapter 11 filing.

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