SANDPOINT, Idaho (AP) — The women’s clothing retailer
Coldwater Creek has filed for Chapter 11 bankruptcy protection after
failing to find a potential buyer or a source of capital to help fund
its turnaround efforts.
Coldwater Creek said Friday that its stores and its website are still open and selling clothing and other
goods to shoppers.
But
it expects to start sales to liquidate its inventory in early May. It
plans to hold going out of business sales in the coming months.
The
chain said it spent the past six months evaluating its options, but
that its declining financial resources, tough retail conditions and its
inability to find other viable options drove it to file for bankruptcy
protection.
Coldwater Creek has struggled in recent years due to
weak consumer spending and a failure to find fashions that resonated
with customers. It hadn’t posted a quarterly profit since the second
quarter of 2010.
The Sandpoint, Idaho-based company had cut costs
and closed some stores during its attempts to keep the business afloat.
It also made other moves to improve its profitability, but declines in
sales trends continued to intensify.
The retailer said that it
reached an agreement with its lenders on a liquidation plan and also
reached a deal with inventory liquidators Gordon Brothers Retail
Partners LLC and Hilco Merchant Resources LLC to manage its inventory
clearance sales. Coldwater Creek said that the liquidation plan doesn’t
contemplate any recovery for its shareholders. The liquidation plan
still needs approval from the bankruptcy court.
Coldwater Creek
Inc. is getting $75 million in debtor-in-possession financing from
existing lender Wells Fargo to help it wind down its business. The
company made its bankruptcy filing in the U.S. Bankruptcy Court in
Wilmington, Del.
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