On Feb. 4, the Bon-Ton Department Stores, a 120-year-old department-store chain that specializes in apparel, accessories, and jewelry, filed for Chapter 11 bankruptcy protection in Delaware federal court.
The Milwaukee-based retailer said that it is has secured up to $725 million of debtor-in-possession financing to support its continued operations. It is also exploring strategic alternatives, which may include a sale of the company or some of its assets.
Bon-Ton currently operates 256 stores in 23 states, under the names Bon-Ton, Bergner’s, Boston Store, Carson’s, Elder-Beerman, Herberger’s, and Younkers. The company previously announced plans to close 47 stores this year.
A court filing from chief financial officer and executive vice president Michael Culhane said the retailer has been “significantly impacted” by the larger forces roiling retail, particularly the growing prominence of the online channel and declining store traffic in certain shopping areas. The company has also been hurt by disappointing third-quarter and holiday sales, Culhane said.
In December, it missed a $14 million interest payment, and the prior month Bloomberg reported that vendors were pulling back on shipments. In fiscal 2016, it posted a $63.4 million loss.
The company has long been considered troubled; last May it appointed chief operating officer William Tracy to head the company. He was its fourth CEO in the past five years.
Bon-Ton employs approximately 23,000 part- and full-time workers. In 2017, it generated approximately $2.55 billion in total revenue.
“We are currently engaged in discussions with potential investors and our debtholders on a financial restructuring plan, and the actions we are taking are intended to give us additional time and financial flexibility to evaluate options for our business,” Tracy said in a statement. “Bon-Ton has seven well-loved brands and associates who have remained committed to delivering excellent service to our customers for decades.”
Its bankruptcy docket can be seen here.