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Published on 3/29/2006 in the Prospect News Distressed Debt Daily.

Winn-Dixie to consolidate Southern Florida distribution operations, sell Pompano Beach facility

By Caroline Salls

Pittsburgh, March 29 - Winn-Dixie Stores, Inc. will consolidate its Southern Florida distribution operations, with plans to sell its Pompano Beach, Fla., distribution center, according to a company news release.

The company said this latest consolidation is part of its ongoing focus on enhancing its financial performance and helping to position the company for profitability when it emerges from Chapter 11 later this year.

The work performed at the Pompano Beach facility will be moved to the company's distribution center in Miami, and associates at the Pompano Beach facility will be offered positions in Miami.

The transfer of operations is expected to begin in late April and be completed by the end of June.

"We have continued to examine our operations to ensure Winn-Dixie is best positioned to emerge from Chapter 11 financially healthier and better able to compete," president and chief executive officer Peter Lynch said in the release.

"Using one facility rather than two in Southern Florida will allow us to leverage economies of scale and operate more efficiently. Proceeds received from the sale of the Pompano distribution center will provide us with additional capital to help fund our remodeling program and other improvements."

Winn-Dixie said it will conduct an active marketing effort to identify potential buyers for the Pompano Beach facility, which is about 787,500 square feet and handles grocery, meat, dairy and produce items.

There are currently 280 full-time and part-time associates at the Pompano facility and 440 at the Miami facility.

Winn-Dixie, a Jacksonville, Fla., supermarket company, filed for Chapter 11 on Feb. 21, 2005 in the U.S. Bankruptcy Court for the Southern District of New York. The case was later transferred to the Middle District of Florida. Its Chapter 11 case number is 05-03817.


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