The Region's largest and best known independent supermarket chain will remain under local control after the original families that owned it banded together and placed a successful bid in a bankruptcy court-supervised auction.
Strack & Van Til President and Chief Executive Officer Jeff Strack said he, the Strack family, the Van Til family and a few others put in a successful bid for 20 Strack & Van Til stores.
"We won!" Jeff Strack said in an email. "We are getting our stores back!"
U.S. Bankruptcy Court Northern District of Illinois Judge Pamela S. Hollis will have to approve the sale at a hearing next Tuesday.
"We were qualified as a bidder last Thursday to participate at the auction for the stores and today we were announced as the winner of the auction," Strack said in an email.
Strack did not disclose how much the group will spend to buy the stores.
Strack, who already owns 10 percent of the Highland-based supermarket chain, said the new ownership group is called the Indiana Grocery Group. It includes the families that previously owned Strack & Van Til before it was sold to the Joliet-based cooperative Central Grocers in 1997.
The Central Grocers wholesaler, which produced the generic Centrella brand and served 400 independent neighborhood grocers throughout the Chicago area, was the seventh largest grocery cooperative in the country with more than $2 billion in annual revenue. Under pressure from creditors after amassing $225 million in debt, it filed for bankruptcy in May after an unsuccessful months-long search for a buyer.
This year, it's closed 14 Ultra Foods and Strack & Van Til stores, laying off 1,900 workers.
Jewel-Osco put in an initial bid of $100 million for 19 remaining Strack & Van Til stores as a stalking horse bidder, a common practice during bankruptcy court-supervised auctions that's meant to set a floor for the price.
Strack said his group bid for 20 stores and other assets.
According to court records, the bankruptcy court was entertaining a bid for Strack & Van Til stores in Cedar Lake, Chesterton, Crown Point, East Chicago, Hammond, Highland, Hobart, Lowell, Munster, Rensselaer, St. John, Schererville, Valparaiso and Whiting, as well as for Town & Country Markets in Portage and Valparaiso, an Ultra Foods store on Broadway in Merrillville, a central bakery in Valparaiso and the corporate headquarters in Highland. The bid covers two Strack & Van Til locations apiece in Crown Point, Hobart and Valparaiso.
Jewel had indicated it wanted to buy the stores to expand its own brand in the Midwest. Indiana Grocery Group's successful bid will preserve a local brand that's been part of the fabric of Northwest Indiana since German immigrant Ernie Strack and Griffith resident Nick Van Til, already both successful grocers in their own right, partnered in 1960 to open their flagship supermarket at Cline Avenue and 45th Street in Highland.
The chain outlasted many other bygone local grocers like WiseWay, PayLow, Burger's, Key Market, Wilco County Market and Thrifty Mart, and was an early pioneer with the introduction of its Ultra Foods discount and Mega-Mart concepts in the 1980s.
Strack & Van Til grew steadily over the years, to the point where it once had 38 locations and more than $1.1 billion in annual revenue. It's affectionately known throughout the Region as "Stracks" and is famed for its fried chicken, baked goods and attentive customer service that includes tie-wearing bag boys who bring customers' groceries out to their cars.
"The Strack and The Van Til families are excited for the opportunity to continue to serve the communities of NWI as we have for over 80 years," Strack said. "While this will be a new company, we will continue to have the same connection to NWI as Ernie Strack and Nick Van Til did when they started their partnership years ago. Our associates, vendor partners and most importantly our customers are why we continue to work so hard. They are the reasons we are here and we appreciate them and will work hard for them. When it comes to it — we are Indiana Made."
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