NEW YORK - December 12, 2010 - The Great Atlantic & Tea Co., best known to grocery shoppers as A&P, says it has filed for Chapter 11 bankruptcy protection.

The company, founded in 1859, says it will have access to $800 million in debtor-in-possession financing and that all of its 395 stores, which are located in eight states in the eastern U.S., are fully stocked and open for business.

The Montvale, New Jersey company says that it determined that it could not complete its turnaround plan without filing for bankruptcy protection.

The filing was widely anticipated. The company's stock price fell more than 67% on Friday, and trading was halted in the afternoon. Shares have traded between 86 cents and $13 in the past 52 weeks.

The company owns A&P, Waldbaum's, The Food Emporium, Super Fresh, Pathmark and Food Basics grocery stores.

A&P is one of the oldest supermarket operators in the country. Its first store was in New York City and sold tea, coffee and spices. It expanded across the nation and by the 1930s was the largest grocer in the country.

After more of a decade of decline, the Hartford family that owned the business sold the majority of it in 1979 to the German retail group the Tengelmann Group. The Tengelmann Group remains one of its largest shareholders. Activist investor Ron Burkle of Yucaipa investment firm is also a significant stockholder in the company.

A&P has struggled for several years with weak sales and heavy debt loads. It reported in its last quarter that it doubled its loss as revenue continued to fall. The company was reportedly in talks with advisory firms in October on how to best deal with its debt burden.

A&P has brought in new management, closed several stores, cut jobs and announced in November that it would sell six Pathmark stores for $89.8 million. However, the company launched its turnaround effort in the midst of a struggling economy as consumers cut back on their spending and competition in the industry stiffened, and it has failed to yield results.