Department store retailer reportedly closer to bankruptcy
Speculation is rising that Bon-Ton Stores is headed towards bankruptcy.
The struggling retailer on Tuesday issued a statement in which it said it has entered into forbearance agreements in which the lender and debt holders won't take action against the company because of the missed payment before Jan. 26. The agreements will expire Jan. 26, though they can be automatically extended to Feb. 4 if both sides agree to extend.
The company also reiterated that it is ongoing discussions with its debt holders “in an effort to strengthen its capital structure to support the business.”
Bon-Ton faced a deadline Monday to pay $14 million in interest on a loan. It has previously delayed the payment by using a 30-day grace period.
On Jan. 12, Bloomberg News reported that senior creditors of the department store company were pushing it to file for bankruptcy. Bon-Ton, which has about $1.2 billion in debt, has not been profitable for the past six fiscal years. It recently announced that it plans to shutter at least 40 stores by the end of 2018.
Bon-Ton Stores operates 260 stores, which includes nine furniture galleries and four clearance centers, in 24 states in the Northeast, Midwest and upper Great Plains under the Bon-Ton, Bergner's, Boston Store, Carson's, Elder-Beerman, Herberger's and Younkers nameplates.
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The struggling retailer on Tuesday issued a statement in which it said it has entered into forbearance agreements in which the lender and debt holders won't take action against the company because of the missed payment before Jan. 26. The agreements will expire Jan. 26, though they can be automatically extended to Feb. 4 if both sides agree to extend.
The company also reiterated that it is ongoing discussions with its debt holders “in an effort to strengthen its capital structure to support the business.”
Bon-Ton faced a deadline Monday to pay $14 million in interest on a loan. It has previously delayed the payment by using a 30-day grace period.
On Jan. 12, Bloomberg News reported that senior creditors of the department store company were pushing it to file for bankruptcy. Bon-Ton, which has about $1.2 billion in debt, has not been profitable for the past six fiscal years. It recently announced that it plans to shutter at least 40 stores by the end of 2018.
Bon-Ton Stores operates 260 stores, which includes nine furniture galleries and four clearance centers, in 24 states in the Northeast, Midwest and upper Great Plains under the Bon-Ton, Bergner's, Boston Store, Carson's, Elder-Beerman, Herberger's and Younkers nameplates.
Read more