S&K files for bankruptcy
Photo provided by Thalhimer/Cushman & Wakefield
S&K Famous Brands Inc.‘s corporate headquarters in western Henrico County, at Interstate 64 and West Broad Street.
S&K Famous Brands Inc.‘s retail store next to its corporate headquarters in western Henrico County.
A bankruptcy judge has given S&K Famous Brands Inc. interim approval for a $13 million line of credit to help the chain as it reorganizes.
The Henrico County-based chain of menswear stores, filed for Chapter 11 bankruptcy protection this morning in court in Richmond.
As part of the interim approval, the chain must find a buyer for its headquarters complex on West Broad Street by May 15. A bidder has committed to offering $5.5 million for the property, a company attorney said. The identity of the bidder was not given.
S&K must still open the process to other bidders.
The complex includes a store, the two-story headquarters building and a 110,000-square-foot distribution center.
S&K operates 136 stores, mostly in the mid-Atlantic and the Carolinas.
According to a filing this morning, the chain has $41 million in assets and $35.5 million in liabilities.
Richard H. Hardy Jr., vice president of finance and information technology, wrote in a statement filed with the court that S&K ran into a "perfect storm."
The troubles included vendors losing faith and, in some cases, demanding cash up front for merchandise; decreased liquidity because of tightening credit markets; and a drop in consumer spending.
--Louis Llovio
Advertisement
Reader Reactions
What strikes me as odd is a “bidder” offering $50/psf for the headquarters building in this kind of real estate market. I wonder if an insider is buying cheap, and what that might mean.
Vert dissapointing, but their direct competitors (Mens Wearhouse & Joseph A Banks) both outperformed nationwide retail results last year. If you look at the last few years, you will find their problems started in ‘05 when several dissatisfied operational executives left the company. Their departure was shortly followed by the untimely death of S&K’s long term President/CEO. He was replaced intially by an individual who led four other companies into bankruptcy (including Richmond based Best Products) before coming to S&K. After his retirement in ‘06 or ‘07 he was replaced by the current CEO whos background is in mergers and acquistions…no retail or menswear experience. Is todays announcement really a surprise?
Are you kidding? Overpriced? Where are you shopping the dollar store? Their prices were very reasonable for the product. Maybe too reasonable. I hope they are able to turn it around. I have used them for years.
The textile, clothing and garment industry has practically disappeared from U.S. You used to be able to buy a decent quality dress suit or other clothing that was made by a American manufacturer. Now everything is made overseas with cheaper labor and the quality was reasonably good and it fit.
Today everything is made overseas and the quality and fit is not as good and overpriced. Maybe it’s just me for getting old and grouchy.
The business model just doesn’t work anymore.
Well, people don’t need suits if they’re unemployed. Just another victim of the sour economy.
This is a shame. I guess we now know what people won’t be wearing.
We have provided goods and services to S&K for many years. They have a mature and talented management team who have a pragmatic view with regard to how they can survive and thrive. Moreover, they work closely with their vendors to achieve mutual success. Don’t count them out. I predict a success story.
That sucks pretty bad. Local guys.
Hopefully, they’ll successfully reorganize. I’ve gotten a lot of good deals there over the years.
Post a Comment(Requires free registration)
- Please avoid offensive, vulgar, or hateful language.
- Respect others.
- Use the "Flag Comment" link when necessary.
- See the Terms and Conditions for details.
Advertisement