Fortunoff bankruptcy impacts casual vendors
Casual Living Industry News
By Clint Engel, Furniture/Today retail editor -- Casual Living, 3/1/2009 12:00:00 AM
Fortunoff, the Northeastern retailer that filed for Chapter 11 bankruptcy protection early last month, began going-out-of-business sales at all of its 20 stores before the month’s end.
U.S. Bankruptcy Court for the Southern District of New York ordered the liquidation of the 87-year-old retailer’s approximately $212 million in inventory. A joint venture group of liquidators won the bid to handle the liquidation.
“These are unprecedented economic times, and it’s unfortunate that after all these years, a New York icon like Fortunoff is going to close and people are going to lose their jobs,” Great America Chairman Harvey Yellen said in a release.
The liquidators said they paid 88.8% of the cost value of the inventory, estimated at about $96 million. The sales will run until all the inventory is sold, which is expected to take a few months, a spokesperson for SB Capital said.
Outdoor furniture supplier Hanamint Corp. of Greensboro, N.C., was listed among Fortunoff’s 30 largest creditors, with an estimated claim of $1.5 million. Court documents also showed other casual furnishings vendors on the creditor list including Agio International, with estimated claim of $875,000; Pride Family Brands with more than $366,000; Erwin & Sons Direct Imports with more than $290,000 and Cast Classics with nearly $250,000.
The retailer of home furnishings, housewares and jewelry is owned by NRDC Equity Partners, which bought the chain out of an earlier bankruptcy in March 2008. NRDC said at the time it hoped to expand the Fortunoff brand beyond its existing retail bases partly by adding new home goods and jewelry departments in Lord & Taylor department stores, which NRDC also owns, as well as opening new outdoor furniture specialty units. The retailer filed again on Feb. 5.
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