The Bon-Ton Stores has filed for Chapter 11 bankruptcy protection as officials with the department store engage in “constructive discussions” with potential investors and debtholders regarding a financial restructuring plan, the company said.
Bon-Ton officials said they will use the court-supervised process to explore potential strategic alternatives to maximize value for the benefit of its stakeholders, which may include a sale of the company or certain of its assets as part of the plan of reorganization. The company’s stores, e-commerce and mobile platforms under the Bon-Ton, Bergner’s, Boston Store, Carson’s, Elder-Beerman, Herberger’s and Younkers nameplates are open and operating as usual.
As previously announced, the Bon-Ton is closing 47 stores in 2018, four of which closed in January and one store that is near completion and 42 additional at which store closing sales began on February 1.
Bon-Ton has received a commitment from its existing ABL lenders for up to $725 million in debtor-inpossession (DIP) financing which, subject to court approval, is expected to support the company’s operations during the financial restructuring process.
“The actions we are taking are intended to give us additional time and financial flexibility to evaluate options for our business,” said Bill Tracy, Bon-Ton president and CEO.