In the midst of closing 40 of its stores across the country, Bon-Ton Stores has filed for Chapter 11 bankruptcy protection. It is the largest retailer to file Chapter 11 this year. Bon-Ton’s 2017 retail performance fell way short compared to rivals such as Kohl’s or JCPenney, which were bolstered by stronger economic conditions and boosted consumer confidence.
On Sunday, Bon-Ton reported a commitment of up to $725 million in financing from existing lenders to support its operations. The retailer currently operates about 260 locations, including those it is planning on closing. Store banners include Carson’s, Elder-Beerman, Herberger’s and Younkers.
“During this court-supervised process, we plan to continue operating in the normal course and executing on our key initiatives to drive improved performance,” CEO Bill Tracy said in a statement.
According to Retail Dive, however, a group of second lien bondholders are pressing for liquidation, saying that “the best and only available path for the debtors to maximize value for their creditors in these freefall bankruptcy cases is to conduct an immediate orderly liquidation of the debtors’ inventory and other assets.”