Citing the bad economy and problems building a new store, Viera, Fla.–based Wesche Jewelers filed for Chapter 11 bankruptcy protection on June 6, but said it intends to stay in business.
The reasons for the action were numerous, according to court papers filed in the U.S. Bankruptcy Court, Middle District of Florida, Orlando division.
To finance construction for a new jewelry store in 2005-2006, the company took out several loans totaling $4.8 million. Following that, the papers claim, a contractor stole $900,000 in funds. The company was forced to raise new money and the store opened in 2006.
However, in 2008 and 2009, the store was hit by the recession, and revenue plunged. Moreover, the company has been unable to sell other parts of the property.
The company has filed Chapter 11, it said, “to reorganize its debts, which will enable it to maintain its business, keep its employees, pay its creditors over time, and operate with positive cash flow.”
The company’s owner did not respond to a request for comment from JCK.