Alco Stores files Chapter 11, to sell or liquidate

Coppell, Texas --Alco Stores Inc. on Sunday filed for Chapter 11 bankruptcy, with plans to liquidate or sell the business.



The 113-year-old retailer and its subsidiary, Alco Holdings Ltd Liability Co., filed voluntary petitions for relief in the U.S. Bankruptcy Court for the Northern District of Texas, Dallas Division. It listed assets of $221.7 million and debt of $161.6 million.



Alco said Wells Fargo intends to provide it with a $110 million revolving credit facility and a $12.6 million secured term loan so it can repay some debts and continue operating.



In court papers, the discounter cited the impact of the “lingering economic slowdown” on its customers, the majority of whom live in small towns and rural areas, and increased competition. Alco, which operates nearly 200 stores, said it hoped to sell its profitable locations and liquidate the others.



Alco is seeking approval to have Tiger Capital Group LLC, SB Capital Group LLC and Great American Group WF LLC together make an initial bid in a bankruptcy auction. The winning bidder will serve as liquidation agent to conduct store closing sales at some or all of the stores.