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Friday, August 28, 2009

Appco finds buyer

Source: Johnson City Press
By Jeff Keeling, Press Business Editor

The bankrupt Appco convenience store chain has found a buyer out of Florida and hopes to close by next week on a $6.25 million deal that will preserve employees? jobs at 47 stores.

Appco?s bankruptcy attorney, Mark Dessauer, filed a motion late Tuesday asking that the sale be approved and calling the offer ?the highest and best bid for the assets of (Appco).? The bidder, Florida Sunshine Investments, also would pay for Appco?s inventory in the deal.

Appco?s chief restructuring officer, Andy Weber, was appointed by the court April 14 and charged with selling the company. Tuesday night, he called the retention of the roughly 350 employees a big plus.

?Selling the company has been a long and difficult process, but the managers and employees in the retail division have done an admirable job of focusing on their mission during that time,? said Weber, of NRC Realty and Capital Advisors, which oversaw the sales process.

The Chicago-based company specializes in, among other things, sale of distressed commercial assets.

?I?m pleased that we?ve found a buyer who recognizes the value loyal and experienced store employees bring to the convenience store business. If this sale is approved as I hope and expect it will be, I?ll be happy knowing that those jobs were preserved.?

If approved, the sale would come nearly two years to the day after a Texas-based company, Titan Global Holdings, paid longtime Appco owner Jim MacLean $30 million in a leveraged buyout. At the time, Appco had about 55 convenience stores in Northeast Tennessee, Southwest Virginia and Southeastern Kentucky, and provided gas to more than 160 independent stores.

In late 2008, Appco began having trouble supplying gas to its independent dealers, and after Titan failed to arrange refinancing of its debt, Appco filed Chapter 11 bankruptcy Feb. 9. Even the Appco stores spent close to two months in January, February and March without gas and many essentials, and they haven?t had lottery tickets since the beginning of the year.

Appco?s bankruptcy case has been full of twists and turns, and Tuesday?s motion revealed that the last few weeks were no different.

Florida Sunshine Investments made a late offer on the company after another bidder - Empire Petroleum Holdings of Rockville, Md. - had lowered its initial $9.1 million bid to $5.5 million saying Appco?s financial information discovered in due diligence was unacceptable. Empire agreed to a stipulation then that Appco could seek oth