Bankruptcy Court in Grand Union Chapter 11 Case Overrules A&P Objection to Sale.

Business Editors

WAYNE, N.J.--(BUSINESS WIRE)--Dec. 1, 2000

The Grand Union Company (OTC BB; GUCO), is pleased to announce that at a day-long hearing held yesterday at the U.S. Bankruptcy Court in Newark, NJ, Bankruptcy Judge Novalyn Winfield overruled an objection by the Great Atlantic and Pacific Tea Company ("A&P"), which had alleged that C&S Wholesale Grocers, Inc. ("C&S") had unlawfully engaged in collusive bidding and had violated anti-trust statutes.

In reviewing the asset sale agreement between Grand Union and C&S and the conduct of the bankruptcy auction on November 16, 2000, the Court found that the Company had met the good faith requirements of the Bankruptcy Code in conducting its sale and also found "no substance to the A&P objection."

The Court has scheduled a hearing for Friday, December 8, 2000 to address landlord and other occupancy issues relating to the C&S Asset Sale Agreement.

"The Court's decision to overrule the A&P objection further signals our continuing progress in quickly moving forward with the sale of the Company's assets," said Jeffrey P. Freimark, President and Chief Executive Officer. "Pending final resolution of the landlord issues on Friday, December 8, 2000, we remain optimistic that almost all of our stores will continue to operate as retail food operations, continuing to serve their communities and customers. Importantly, there will be significant continued employment opportunities for our dedicated Grand Union staff going forward."

Additionally the following two transactions received Court approval: the sale of the Bleecker Street store in Manhattan to New York University to occur on or before January 31, 2001; and the retention of the Great American Group to manage the sale of the inventory at nine stores at which Grand Union is discontinuing operations, to be completed on or before January 31, 2001. While the Great American inventory sales move forward, Grand Union will continue its active search for purchasers for the nine locations.

Grand Union operates 197 retail food stores in Connecticut, New Jersey, New York, Pennsylvania and Vermont.

Some of the matters discussed herein are "forward-looking statements" within the meaning of the private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. For additional information about he Company and its various risk factors, please see the Company's most recent form 10-K for the fiscal year ended April 1, 2000, as filed with the Securities and Exchange Commission on June 30, 2000, as form 10-Q for the fiscal quarter ended July 22, 2000, as filed with the Securities and Exchange Commission on September 1, 2000.