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PENN TRAFFIC COMPANY FILES REGISTRATION STATEMENT

 JOHNSTOWN, Pa., March 1 /PRNewswire/ -- The Penn Traffic Company (AMEX: PNF) announced today that it has filed a registration statement relating to a proposed public offering of $300 million principal amount of senior subordinated notes due 2005 (the "notes") and of 2,000,000 shares of common stock.
 The offering of the notes will be underwritten by Goldman, Sachs & Co. and by BT Securities Corporation. The managers for the offering of the common stock are Goldman, Sachs & Co.
 The offerings are part of a series of transactions, including the mergers of the company's subsidiaries P&C Food Markets, Inc. ("P&C") and Big Bear Stores Company ("Big Bear") into Penn Traffic and the retirement of certain debt bearing interest at rates ranging from 12-3/4 percent to 13-3/4 percent per annum.
 These transactions are intended to simplify the company's capital structure and reduce interest expense. Penn Traffic believes that the creation of a single borrowing entity with greater geographic, demographic, economic and competitive diversity will reduce its cost of capital. In addition, Penn Traffic believes that the transactions will allow it to improve its purchasing power and reduce operating expenses.
 Penn Traffic owns all the outstanding capital stock of P&C, and approximately 97.6 percent of the common stock of Big Bear. Also outstanding are 499,000 shares of convertible preferred stock of Big Bear (excluding shares owned by Penn Traffic). Holders of shares of Big Bear common stock and Big Bear convertible preferred stock will be entitled to receive merger consideration having a value of $36 per share (valuing shares of Penn Traffic common stock received as merger consideration, as described below, at $35.125 per share). The total consideration that would be paid to Big Bear shareholders is 307,850 shares of Penn Traffic common stock and approximately $10.8 million. Shareholders of Big Bear will be given the opportunity to elect to receive cash or shares of Penn Traffic common stock, subject to proration in the event that the amount of cash or stock necessary to satisfy all elections exceeds one-half of the aggregate merger consideration. The mergers of P&C and Big Bear into Penn Traffic are conditioned upon the closing of the offerings of notes and Penn Traffic common stock described above.
 In addition to the newly issued shares of common stock being publicly offered by the company as described above, the public offering will include the sale of an additional 788,115 shares of common stock owned by Salomon Brothers Holding Company Inc. The company will not receive any of the proceeds of the sale of these shares. The closing of the public offerings and the mergers of P&C and Big Bear into Penn Traffic will occur concurrently.
 A registration statement relating to the notes and the common stock has been filed with the Securities and Exchange Commission, but has not yet become effective. The notes and the common stock may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the notes or the common stock in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state. The offering will be made only by means of prospectus.
 Penn Traffic is one of the leading food retailers in the eastern United States, operating 217 supermarkets in western Pennsylvania, upstate New York, Ohio and northern West Virginia under the names of Riverside Markets, Bi-Lo Foods, Quality Markets, P&C Foods, Big Bear and Big Bear Plus. Additionally, the company operates wholesale food distribution businesses serving 133 licensed franchisees and 127 independent operators and a discount general merchandise business with 17 stores. Grand Union, in which Penn Traffic holds a 17.8 percent equity interest, operates supermarkets in the eastern United States.
 Penn Traffic trades on the American Stock Exchange under the symbol PNF.
 -0- 3/1/93
 /CONTACT: Gary D. Hirsch, chairman of the board of Penn Traffic, 212-370-0040/
 (PNF)


CO: Penn Traffic Company ST: Pennsylvania IN: REA SU: OFR

DM-CD -- PG014 -- 1531 03/01/93 14:56 EST
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Publication:PR Newswire
Date:Mar 1, 1993
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