On Feb. 14, Samuels Jewelers, a 112-store retailer with roots that date back more than a century, told employees that it will shut all of its stores by Feb. 25.
The Austin, Texas–based retail chain, which does business under the Samuels Diamonds, Rogers, Andrews, and Schubach nameplates, had filed for Chapter 11 on Aug. 7. In October, it launched store-closing sales, but still hoped that a suitor would purchase its profitable stores.
According to an email sent to employees and obtained by JCK, that is no longer feasible.
“Until Feb. 12, we, the current management of Samuels, were very hopeful and confident that a transaction we had located would allow 60 to 64 go-forward stores and the continuation of the business under new ownership,” it said. “However, our secured lender Wells Fargo has chosen to exercise their ability to obtain, among other things, the intellectual property rights for all the consumer-facing business names…as well as the web addresses for all the brands and the unsold inventory. This effectively ensured that the transaction we were diligently pursuing…will not be possible now or in the foreseeable future.”
It called the development “unexpected and tragic, but unfortunately it is our new reality.”
Samuels executives and Wells Fargo’s counsel did not return requests for comment.
In a Feb. 14 court filing, the company canceled a scheduled auction of its assets, saying it would go with Wells Fargo’s credit bid.
Founded in 1891 and formerly known as Barry’s, Samuels has long been, and remains, one of America’s largest jewelry chains. In 2006, Gitanjali Group, then a powerhouse of the Indian industry, bought the company. A year later, it also purchased Rogers Jewelers.
In February 2018, Indian authorities charged Gitanjali and chairman Mehul Choksi with defrauding Indian banks. And while Gitanjali claimed that Choksi had been “falsely implicated,” it shut down operations shortly after.
While Gitanjali’s woes prompted the filing, Samuels, like many retailers, had a tough time finding a place in the new economy. While it regularly posted more than $100 million in annual sales, its bankruptcy petition listed more than $100 million in both assets and liabilities, including $84 million owed to Wells Fargo.
This has been Samuels’ fourth, and seemingly final, trip to bankruptcy court. Samuels filed for Chapter 11 in 2003 and filed for Chapter 11 twice under the name Barry’s.
(Image courtesy of Samuels Jewelers)