As Bon-Ton liquidates, U.S. department stores vie for its shoppers
19/04/2018 24:53
By Tracy Rucinski and Melissa Fares
April 18 (Reuters) - Bon-Ton Stores Inc BONTQ.PK won court
approval on Wednesday for a bid to wind down its operations,
clearing the way for one of the largest U.S. department store
chains to begin selling everything from its store inventory to
leases and fixtures.
With the disappearance of Bon-Ton, analysts said rivals such
as Macy's Inc M.N , J.C. Penney Co Inc JCP.N and Kohls Corp
KSS.N will compete to keep longtime customers from turning to
discounters like Walmart Inc WMT.N or online stalwart
Amazon.com Inc AMZN.O .
"Now Macy's and J.C. Penny will be the primary beneficiaries
of Bon-Ton's bankruptcy, and Stein Mart Inc SMRT.O will be
able to get great leases at rock bottom low prices," said Burt
Flickinger, managing director at retail consultancy Strategic
Resource Group. "Ironically, Sears Holdings Corp SHLD.O , which
to its credit has done a very good job in the last three to four
quarters on soft lines and clothes and apparel, will benefit
greatly, too."
Dozens of traditional brick-and-mortar retailers have been
forced to shutter stores and file for Chapter 11 bankruptcy as
they rethink their businesses in the face of rising online
competition. As many end in liquidation, others such as J.C.
Penney are trying to pick up market share. urn:newsml:reuters.com:*:nL4N1QK4GE
Going out of business sales will begin soon for Bon-Ton's
stores, e-commerce and mobile platforms as well as its
Bergner's, Boston Store, Carson's, Elder-Beerman, Herberger's
and Younkers nameplates.
"Oh this is just too bad. I love my Carson's," said Maribeth
Faland, 59, who has shopped at the Chicago-area department store
for some 30 years. "I guess I will have to shop online soon. All
the good stores are closing."
More than 8,000 U.S. stores closed in 2017, nearly double
the average of the previous 10 years, according to data by the
International Council of Shopping Centers.
York, Pennsylvania-based Bon-Ton, which traces its roots to
1854, had 23,000 employees and 256 stores across 23 states when
it filed for Chapter 11 bankruptcy in February with the hope of
cutting debt and emerging from a brutal retail landscape under a
new owner. urn:newsml:reuters.com:*:nL4N1PV20N
But a proposal by U.S. mall owners Namdar Realty Group and
Washington Prime Group Inc WPG.N that would have kept open a
large portion of Bon-Ton locations never materialized.
urn:newsml:reuters.com:*:nL1N1RV03N
Instead, a joint venture by liquidators Great American Group
and Tiger Capital Group won an auction for Bon-Ton's inventory
and other assets. U.S. Bankruptcy Judge Mary Walrath of Delaware
said on Wednesday she would approve the sale to the joint
venture.
It is possible some of the Bon-Ton stores will be acquired
by another retail operator that could reopen the stores under
one of its nameplates, but the timing and outcome of future
auctions by the liquidators is still uncertain.
Bon-Ton also competes with traditional operators such as
Boscov's Department Store LLC, Dillard's Inc DDS.N and Von
Maur Inc.
Its failure comes weeks after Toys 'R' Us began a piecemeal
liquidation of its namesake stores and Babies 'R' Us.
urn:newsml:reuters.com:*:nL3N1QW609
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J.C. Penney sees year profit largely below Wall Street, shares
dive urn:newsml:reuters.com:*:nL4N1QK4GE
Liquidators to wind down U.S. department store chain Bon-Ton
urn:newsml:reuters.com:*:nL1N1RV03N
U.S. department store chain Bon-Ton files for bankruptcy
urn:newsml:reuters.com:*:nL4N1PV20N
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(Reporting by Tracy Rucinski in Chicago and Melissa Fares in
New York; additional reporting by Karen Pierog in Chicago;
Editing by Lisa Shumaker)
((Jessica.DiNapoli@thomsonreuters.com; 646-223-4678;))