Bon-Ton Files for Bankruptcy Protection
Bon-Ton Stores said yesterday that it has filed for Chapter 11 bankruptcy protection. The regional department store chain, which has dual headquarters in Milwaukee and York, Pa., is currently engaged in discussions with potential investors and debt holders regarding a financial restructuring plan, which may include a sale of the company or assets. Bon-Ton has received a commitment of up to $725 million in financing from existing lenders to support its operations, according to the company.
"During this court-supervised process, we plan to continue operating in the normal course and executing on our key initiatives to drive improved performance," said CEO Bill Tracy. Bon-Ton Stores, which operates 260 retail locations under its various banners (Carson's, Elder-Beerman, Herberger's, and Younkers), will continue its recently announced plans to shutter 47 stores across the U.S. in 2018. Four of these stores closed in January, one store that's near completion, and 42 additional store closings began on Feb. 1 and will run for approximately 10 weeks to 12 weeks.
Total Retail's Take: The announcement by Bon-Ton is important because it signifies the largest retailer to declare bankruptcy so far in 2018. Bon-Ton was widely predicted to be the next retail bankruptcy. The department store chain recently reported a dismal holiday season, for example, despite the fact that many of its department store peers, including J.C. Penney, Kohl's and Macy's, reported strong holiday performances. What's more, Bon-Ton has been burdened with massive debt as it struggles to grow sales and move operations online in the face of Amazon.com.
