Getty Petroleum Files for Chapter 11 Bankruptcy
EAST MEADOW, N.Y. -- Getty Petroleum Marketing Inc. (GPMI) filed for Chapter 11 bankruptcy reorganization this morning, Reuters reported.
In its filing with the U.S. Bankruptcy Court for the Southern District of New York, GPMI said it has an estimated $50 to $100 million in assets, as well as liabilities within the same range. GPMI expects to operate normally during its reorganization, the report stated.
Whether GPMI will continue to operate those gas stations/convenience stores owned and leased by Getty Realty Corp. is another question, however. GPMI's bankruptcy move comes just five days after landlord Getty Realty sent notice that it planned to evict its largest client for failure to pay its November rent. Getty Realty said it would subsequently issue new leases with other potential tenants or sell the properties.
Getty Realty owns and leases roughly 1,555 stores nationwide. About 800 of those stores are leased by GPMI.
In its most recent public statement, made Friday, GPMI did not mention the possibility of seeking bankruptcy protection. Instead, it reiterated a previous accusation that Getty Realty breached the master lease between the two parties because it has not performed necessary environmental remediation.
"Getty Realty has the responsibility to evaluate and remediate certain environmental contamination on particular properties leased by Getty Petroleum," GPMI stated in Friday's news release. "Environmental remediation is not only critical to protect the quality of surface water, ground water, soils, sediments and other parts of the environment from various contaminants, but is equally critical for Getty Petroleum's business operations." GPMI added that it has the right to take control of such environmental remediation and then offset the costs for those actions against its monthly rent.
Getty Realty has said on several occasions in the past that the environmental claims were completely "without merit."
According to Reuters, Getty Realty is not the only company with whom GPMI has had a dispute. Disagreements have also occurred between GPMI and Bionol Clearfield, Lukoil Americas Corp. and Lukoil North America. Earlier this year, GPMI agreed to pay $230 million to Bionol in a settlement, according to a court filing.