Storehouse owner files bankruptcy
September 21, 2006
Storehouse owner files bankruptcy. Check it out:(Richmond Times-Dispatch (VA) (KRT) Via Thomson Dialog NewsEdge) Sep. 20--Furniture manufacturer and retailer The Rowe Companies has filed for federal bankruptcy protection because of rising expenses and declining sales.
The company, based at McLean in Fairfax County, said operations at its plants and its Storehouse retail stores will continue as usual.
But the company said its long-term plan calls for the sale of its Storehouse chain, which Rowe bought in 1999.
Storehouse operates about 70 stores, including seven in Virginia. Two stores are in the Richmond area -- at Stony Point Fashion Park and in Carytown.
The president of the Atlanta-based retailer is Caroline Hipple, a former Richmonder who had been executive vice president of This End Up.
Rowe listed $93.3 million in debts and $130 million in assets. It had losses in six of the past seven quarters. The company blamed lower-priced competition from Asia and a computer system installed in late 2004 as reasons for the filing.
Rowe implemented a number of cost-saving measures and other initiatives in the past year to turn around the business, the company said in court papers.
"Despite the cost reduction initiatives being undertaken, the manufacturing and retail segments have not to date generated sufficient profits from operations to cover their respective shares of interest expense, corporate overhead and capital expenditures," court papers said.
Gerald Birnbach, Rowe's president and chief executive, said the filing was necessary. "We expect that the restructuring steps we are taking, while difficult, will ensure the future of our enterprise and our people," Birnbach said in a statement.
Trading was halted on the American Stock Exchange. Shares have fallen 82 percent in the past year to 43 cents.
Rowe owes General Electric Capital Corp. about $35 million under a 2006 loan. The company's largest unsecured creditor is Carpenter Co. in Richmond, which is owed $793,000.
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Copyright (c) 2006, Richmond Times-Dispatch, Va.
Distributed by McClatchy-Tribune Business News.
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Related Tags: richmond times, times dispatch, storehouse, Richmond, richmond, company
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