Discount Store Operator Files for Chapter 11 Protection
Sep. 07, 1993
HENDERSON, N.C. (AP) _ Rose's Stores Inc. filed today for bankruptcy court protection, saying some vendors quit shipping merchandise in the wake of the discount retailer's second-quarter loss.
George L. Jones, president and chief executive, said the company has received a $125 million loan from GE Capital Corp., subject to court approval.
The company does not plan to close any of its 215 stores which are in 11 states mostly in the southeast, he said.
''We will make solid progress rapidly as restocking of our stores should begin within a few days. We look forward to a fully stocked Christmas season,'' Jones said in statement.
''Our object is to return existing stores to acceptable levels of profitability,'' he said.
Rose's reported last month it lost $11.6 million, or 62 cents a share, in the second quarter compared to a loss of $5.7 million, or 31 cents a share, a year earlier, said Bob Gorham, a Rose's spokesman.
For the first half, Rose's lost $10.4 million, or 56 cents per share, compared to a loss of $11.8 million, or 91 cents per share, in 1992.
Support from vendors eroded when those results were released Aug. 23, Jones said.
''We have had a strong relationship with our vendors and look forward to working with them in every way possible to place their products in the hands of our customers,'' he said.
The company filed for protection under Chapter 11 of the bankruptcy laws in federal court in Raleigh. The filing permits the company to delay outstanding payments while it develops a financial reorganization plan.
Rose's has 102 stores in North Carolina; 49 in Virginia; 14 in South Carolina; 15 in Georgia; 10 in Kentucky; six in Tennessee; six in Maryland; five in Delaware; four in Mississippi and two each in Alabama and West Virginia.
The stores operate under the name Greatest Deals at two North Carolina stores and at one store in Georgia.