Republic National Distributing Co (RNDC) has capped a torrid 14 months with the news that it has filed for Chapter 11 bankruptcy.
The distribution major initiated the voluntary process in Texas on Sunday (26 July) with the US Bankruptcy Court for the Southern District of Texas. In a subsequent statement online, RNDC said the decision had been made “to explore potential sale transactions in court and implement an orderly wind down of our remaining operations”.
National Distributing Company, which merged with Republic Beverage Company to create RNDC in 2007 but remains a separate legal entity, was not included in the filing. RNDC’s joint venture in Alaska is the only regional tie-up included, leaving those in Illinois, Indiana, Kentucky, Michigan, New York and Ohio outside the Chapter 11 process for now.
“This decision was not made lightly,” RNDC said. “Over time, our industry has evolved, consumer preferences have shifted and the wholesale environment has grown increasingly challenging.
“Over the last several months, we have taken deliberate steps to transition our operations across certain markets. We pursued and closed sales that preserved over 5,000 jobs and allowed our businesses in those markets to continue serving their customers and suppliers.
“Ultimately, RNDC’s financial position required us to pursue an in-court process.
“The court-supervised process is intended to give us the time and flexibility to continue working with parties that have expressed an interest in acquiring our other markets and conduct an orderly wind down of our remaining operations.”
Having sparked shockwaves across the alcohol industry in the US when it withdrew from the Californian market last September, RNDC confirmed in April that it planned to sell its operations in the country’s 17 Control States to New England-based Martignetti Co’s. A day earlier, Columbia Distributing said it had secured a letter of intent to buy “certain wine and spirits distribution rights in Oregon and Washington” from RNDC.
In March, Pernod Ricard’s US division detailed a move away from RNDC for its full portfolio through a “market-by-market approach”.
The departures continued earlier this month, when Wilson Daniels moved away from RNDC in 13 US states, passing distribution responsibilities to Reyes Beverage Group and Johnson Brothers.
