Staff -- Home Textiles Today, 3/8/2009 12:00:00 AM
Creditors Gain Little in LNT GOB
Linens Holding Company, the entity that owned now-defunct Linens 'n Things, took in $172 million in sales receipts and tenant allowances from Nov. 23, 2008 to Jan. 3, according to a March 2 SEC filing.
When going out of business sales began in October, the company had $650 million in secured debt outstanding. A consortium of six liquidators that won the bid to conduct the sales paid Linens $200 million in October with additional amounts to be paid as the GOB sales progressed. Cash payouts go first to secured lenders as well as note holders.
Gottschalks Auction Extended
Troubled 61-unit department store Gottschalks received bankruptcy court approval to extend its auction date until March 30, "to allow for further negotiations related to potential going concern offers." Gottschalks said it "remains in active discussions with multiple potential buyers and continues normal business operations in its stores." Gottschalks filed Ch. 11 on Jan. 14. Gottschalks said the court approved its Employee Retention Plan and Executive Incentive Plan, "finding that they were appropriate in assisting the company to achieve its goals." Chairman and ceo Jim Famalette said, "We continue to negotiate in good faith with potential buyers to keep Gottschalks as a going concern."
Target Opens 27 Stores
Target Corp. opened 27 new stores in 15 states — including its first two sites in Hawaii — on the March 7–8 weekend, sending total store count to 1,699 in 49 states. Six of the new units are SuperTargets, about 186,000 square feet and featuring a full grocery. These are located in: Kissimmee, Fla.; Canton, Ga.; Hillside, Ill.; and three Texas locations in Allen, Lewisville, and Pflugerville. The other 21 units, regular Targets, measure about 128,000 square feet.
Ackman Eyes Seats on Target Board
Activist investor William Ackman wants Target's board to seat an undisclosed number of candidates as directors, according to an SEC filing by Ackman's Pershing Square Capital Management. Pershing owns a 7.8% stake in the retailer.
Last October, Ackman proposed Target spin off its land to a specialized real estate investment trust, which would then rent the property back to Target in a 75-year master ground lease. He said this would cut Target's debt and capital outlays, free up cash, boost return on capital, improve its valuation and stock price.
Pershing Square said it continues to believe in the plan. According to reports in the financial press last week, the Pershing hedge fund that invests only in Target has lost 93% of its value since it was established.
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