Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: TUESDAY, February 12, 1991 TAG: 9102120114
SECTION: BUSINESS PAGE: B6 EDITION: METRO
SOURCE: Associated Press
DATELINE: LOS ANGELES LENGTH: Medium
The debt-laden company, which until last year owned the Thalhimers chain, took on a huge debt while fending off a takeover attempt three years ago, reported weak sales over Christmas and lost $26 million in its past fiscal year. Carter Hawley Hale still owns the Broadway, Emporium and Weinstocks department store chains.
The Chapter 11 reorganization petition was filed in U.S. Bankruptcy Court. Carter Hawley Hale has 88 stores in six Western states, mostly in California.
"This decisive action will enable the company to re-establish trade credit and . . . a proper infusion of capital," said Philip M. Hawley, chairman and chief executive officer.
"Staying out of Chapter 11, given present conditions, might have led to a far worse situation - liquidation and potentially a greater loss of value for creditors as well as equity holders," the company said in a statement.
Carter Hawley Hale said employee payrolls will be met and benefit programs will continue. The company had already eliminated about 1,000 jobs to cut costs.
Carter Hawley Hale fended off a takeover in 1988 by piling on debt and spinning off the upscale Neiman Marcus and Bergdorf Goodman stores. It has recently moved to cut that debt to about $700 million from $1.6 billion.
In December, it sold its Thalhimers chain, based in Richmond, Va., for $317 million to May Department Stores. Thalhimers runs stores in Roanoke and Lynchburg.
Carter Hawley Hale said last week that a tentative agreement to sell its credit card operation to General Electric Capital Corp. for $50 million had fallen apart and the company was abandoning attempts to arrange a $100 million pool of working capital with a group led by the Bank of America.
by CNB