Subject:
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Re: Ames to close all remaining stores
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Newsgroups:
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lugnet.market.shopping
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Date:
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Thu, 15 Aug 2002 07:17:52 GMT
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Viewed:
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512 times
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In lugnet.market.shopping, Nate Jacobs writes:
> To follow up Troy's message....Found this on CNN Money
http://money.cnn.com/2002/08/14/news/companies/ames/index.htm
Ames Stores to shut down
Discount retailer to liquidate remaining 327 locations,
affecting 21,500 employees.
August 14, 2002: 9:29 AM EDT
NEW YORK (CNN/Money) - Ames Department Stores,
once one of the leading discount chains in the
Northeast, said Wednesday it will close its remaining
327 stores and liquidate its assets in order to avoid
defaulting on its loan covenants.
The 44-year-old Rocky Hill, Conn.-based retailer said it has
21,500 employees working in the stores, although company
officials could not be reached to say how many are full-time or
part-time.
The company filed for bankruptcy court protection Aug. 20,
2001, when it had 452 stores. It has closed more than a
quarter of those since, and now operates in 14 states from
Maine to Virginia.
The company had announced a series of financing deals since
the filing, most recently a $25 million debtor in possession
package from GE Capital in June. But the company said
Wednesday it has determined that "asset values can best be
maximized for the benefit of all creditors by terminating
operating losses and winding down the business."
Ames reported a loss of $49.1 million, excluding a gain from
change of accounting practices, for the period ending May 4,
the most recent period for which it has reported results.
That's a wider loss than the $27.7 million deficit on the same
basis a year earlier. Net sales fell to $567.9 million from
$793.7 million a year earlier.
"This was a wrenching decision, but the right course to take,"
Chairman and CEO Joseph R. Ettore said. "Continued
softness in sales, combined with tightening [credit] terms and
slower shipments from our suppliers, have reduced our funds
availability below critical levels."
Stores are expected to remain open about 10 weeks while a
liquidator conducts a going out of business sale.
Regional discount department store chains have been
particularly hard hit by the growth of national chains such as
Wal-Mart Stores, Target Corp. and Kohl's Corp. Norwalk,
Conn.-based Caldor Corp. closed in 1999, and Braintree,
Mass.-based Bradlees closed last year.
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