CLEVELAND — Lucky's Market announced on Monday that it will voluntarily file for Chapter 11 bankruptcy protection, but it will continue to operate stores in seven locations, including Cleveland.
"After careful deliberation and a thorough review of strategic and financial alternatives, the company has decided to voluntarily file for Chapter 11 protection to facilitate the sale of its remaining assets and has signed an Asset Purchase Agreement with ALDI for five leased store properties and the purchase of one owned property," Lucky's Market said in a statement. "The Company still plans to cease operations in the 32 identified locations in the coming weeks and is currently running sales for its customers in those stores."
Last week, reports from the South Florida Sun Sentinel and Progressivegrocer.com indicated that Lucky's was planning on closing "as many as 32 of its 39 stores," including 20 of its 21 stores in Florida.
A Facebook post from Lucky's Market Cleveland helped to calm fears of a closing locally. "There has been some recent news circulating about Lucky's stores closing. We want to assure you that your store in Cleveland will remain open and we look forward to serving you, our loyal customers. Please come in soon to visit us."
RELATED: Lucky's Market Cleveland says it plans to stay open despite reports of nationwide store closings
In addition to Cleveland, Lucky's Market will remain open in Columbus; Traverse City, MI; Columbia, MO; Melbourne, FL; North Boulder, CO; and Fort Collins, CO.
The decision by Lucky's to file for Chapter 11 protection comes after Kroger announced in December that it planned to divest its stake in the chain. Lucky’s had 17 stores when it announced the Kroger investment in April 2016.
“Unfortunately, Lucky’s expanded very fast after Kroger became involved,” said Neil Z. Stern, senior partner at Chicago-based retail consulting firm McMillanDoolittle told the Sun Sentinel. “They became spread too thin, took some questionable real estate and ultimately they had a huge number of underperforming stores that were not sustainable. Still, this is a huge retrenchment.”