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GREEN BAY, Wis. — Shopko Stores Operating Co. announced today that it has filed for Chapter 11 bankruptcy protection. The retailer reported that it would also be closing 38 stores as part of a reorganization process that was prompted by “excess debt and ongoing competitive pressures.”
Shopko said it will also be moving more than 20 of its in-store optical centers to freestanding locations. The retailer will also be selling what remains of its pharmacy business following to sale of script files to Hy-Vee, Kroger and CVS in separate deals in December.
“This decision is a difficult, but necessary one,” said Russ Steinhorst, chief executive officer. “In a challenging retail environment, we have had to make some very tough choices, but we are confident that by operating a smaller and more focused store footprint, we will be able to build a stronger Shopko that will better serve our customers, vendors, employees and other stakeholders through this process.”
Shopko has obtained up to $480M debtor-in-possession (DIP) financing that will help it pay suppliers and other business partners as it continues to operate its stores during the restructuring.
Shopko was founded in 1962, the same year that saw the debuts of the Target, Walmart and Kmart chains. According to its web site, Shopko currently operates more than 300 stores in 26 states.
