Bloomberg: Gottschalks talking with possible buyers
| Friday, Mar 20 2009 02:32 PM
Last Updated Monday, Mar 30 2009 04:25 PM
GOTTSCHALKS INC. TIMELINE
1904:launches in Fresno, founded by German immigrant Emil Gottschalk
1987:buys Bakersfield’s popular Brock’s Department Store
1986:trades on the New York Stock Exchange
1998:buys Harris Department Stores’ nine Southern California locations, including Bakersfield’s
2000:buys more than 30 of bankrupt Seattle-based Lamonts stores, expanding Pacific Northwest presence
May 2008:Bakersfield’s two locations in East Hills Mall consolidate, leaving empty the former Harris building
October 2008:delisted from New York Stock Exchange after value falls below $25 million
November 2008:announces $30 million deal with Chinese investor, Everbright
Dec. 4, 2008:reports a $13.6 million loss for first nine months of its fiscal year; days later, the full report says a cash infusion is needed before the end of January
Dec. 18:Everbright scraps deal; the next day, Gottschalks says talks with Everbright and another suitor are ongoing
Jan. 8:December sales results show a 9.6 percent drop from previous year
Jan. 9:Women’s Wear Daily says a $50 million deal is brewing with Everbright and another investor; Fresno’s Business Journal says employees are told to cash paychecks before imminent bankruptcy
Jan. 14:Gottschalks files for Chapter 11 bankruptcy.
Sources: Gottschalks Web site, Californian archives
What’s next for ....
Customers:The company is seeking the bankruptcy judge’s OK to honor programs such as the Plus Program for seniors, the KidZone Program, Gottschalks Treasure Rewards and a credit card that gives customers points and other incentives. The store also wants to continue accepting returns for refunds or store credit and wants to keep selling gift cards.
Employees:An emergency motion to authorize payment of payroll, benefits and related taxes and prevent banks from placing a hold on or reversing automatic deposits will be considered at today’s initial hearing in Delaware.
The company wants the court’s approval to honor vacation, personal, sick leave, bereavement leave and other paid time off.
Gottschalks employs 2,817 full- and 2,465 part-time employees, for a total of 5,282 workers.
East Hills Mall:Gottschalks and Mervyns own their buildings so the mall can’t lease the sites, officials say. They are pursuing tenants for other sites and say overall sales are fine.
Valley Plaza:Parent company General Growth Properties is itself considered likely to file for bankruptcy protection. Mall owners says it’s too soon to tell what impact the Gottschalks filing will have.
Unsecured creditors:Among the top 20 owed money are The Harris Co., Liz Claiborne, The CIT Group/Commercial Services and Finlay Fine Jewelry.
Gottschalks listed $288 million in assets and $197 million in debt.
Shares:As is typical when a publicly owned company files for bankruptcy, trading of shares was expected to be temporarily halted.
Gottschalks, which trades over-the-counter under the symbol GOTT.PK, closed down 3 cents at 15 cents per share Wednesday.
Buyers:Analysts are pessimistic about a purchase of the entire chain. Several larger retailers might pick off assets here and there, they said.
Images
Shoppers come and go at Gottschalks in Valley Plaza on a January afternoon.
Related Stories:
- Gottschalks consolidates at East Hills Mall
- Making East Hills alive again
- Demolition of old Robinsons-May site makes way for Target
- Gottschalks kicked off New York Stock Exchange
- Gottschalks: deal scrubbed but talks go on
- Will post-holiday sales make a difference?
- Conflicting reports on potential Gottschalks rescue, or bankruptcy
- Californian exclusive: Construction of new Target shut down
- Analysis: Could Gottschalks go back to Harris?
- Gottschalks seeks OK to give execs bonuses
- Oddly Enough: Gottschalks lender says give me back that jet!
- Judge OKs bonuses for Gottschalks execs
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Ongoing private discussions could lead to an arrangement that would allow Gottschalks department stores to continue operating beyond July, according to a Bloomberg news report out this week.
Citing two anonymous sources reportedly familiar with the matter, the news service said three companies — El Corte Ingles, of Madrid; GK Development Inc., of Barrington, Ill.; and Golden Gate Capital Corp., of San Francisco — have signed confidentiality agreements to review the retailer’s financial records.
Fresno-based Gottschalks, which has two stores in Bakersfield, filed for Chapter 11 bankruptcy Jan. 14.
If they are interested in purchasing the chain, the three companies identified by Bloomberg would have until March 30 to submit a bid. So far, the only confirmed bidder is a consortium of four liquidation specialists: SB Capital Group LLC, Tiger Capital Group LLC, Great American Group LLC and Hudson Capital Partners LLC.
GK Development declined to comment on the news report. Executives at Gottschalks and the other potential bidders could not be reached for comment Friday.
El Corte Ingles, a Spanish retailer, has maintained a financial interest in Gottschalks since the Fresno company purchased The Harris Co. from El Corte in 1998.
GK Development is a privately held real estate acquisition and development company. It specializes in retail and commercial properties.
Golden Gate Capital is a private equity firm active in sectors including computer technology, retail, financial services and media.
