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(This news comes to you by courtesy of REW).
>>Monday February 1, 7:55 pm Eastern Time
Wards to emerge from bankruptcy in mid-1999
CHICAGO, Feb 1 (Reuters) - Montgomery Ward & Co., one of the nation's 10 largest department stores, said Monday it had reached an agreement with creditors that will let it emerge from Chapter 11 bankruptcy protection in mid-1999.
As a first step in the agreement, General Electric Co.'s (NYSE:GE - news) GE Capital, a major creditor, will acquire Wards' direct marketing business arm, Signature Group, which was not part of the bankruptcy filing, the retailer said.
Montgomery Ward will then place a sum in a fund to settle court-approved pre-bankruptcy unsecured claims of creditors other than GE Capital. Meanwhile, GE Capital and Montgomery Ward management will receive the equity in the reorganized retailer, the company said.
Montgomery Ward filed for bankruptcy protection in July 1997.
Financial information regarding the agreement will be disclosed when the company files the plan with the bankruptcy court in the next few weeks, the company said.
In the last 18 months, Wards closed more than 100 under-performing stores, developed and tested new prototype stores, reduced staff and changed its marketing strategy.
In the critical 1998 holiday selling season, Wards' total company same store sales increased 3 percent, the company said.
For the month of December 1998, it will report a positive earnings before interest and taxes from retail operations of $12 million and a positive earnings before interest taxes depreciation and amortization of $31 million, the company said.<< |
