Steve & Barry's Could File For Bankruptcy As Soon As Next Week
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Steve & Barry's Co-Founders
Steve Shores (l) And Barry Prevor |
Steve & Barry's, which has about 275 stores nationwide and sales nearing $1B, "may have to file for bankruptcy as soon as next week" if Goldman Sachs Group Inc. cannot "line up at least $30[M] in last-minute rescue financing," according to sources cited by McCracken & Lattman of the WALL STREET JOURNAL. The chain has hired both a bankruptcy attorney as well as N.Y.-based restructuring firm Conway, Del Genio, Gries & Co., which was hired by Sharper Image and Linens 'n Things. Both of those retailers "have since filed for bankruptcy." Steve & Barry's, which opened eight stores in the last month and has 12 more in the works, has "added stores while other retailers closed sites or even filed for bankruptcy." But four mall real estate investment trusts said that the chain's earnings were about $20M on sales of $1B, and the store "often lost money on its key merchandise." Meanwhile, Steve & Barry's "appears to have been getting far behind on some bills," and some small vendors "say they were going unpaid, or enduring months of lag time between payments." The chain is "no longer allowed to advertise" in the Univ. of Michigan (UM) student newspaper, The Michigan Daily. UM student and Michigan Daily Business Manager Elaina Bugli said that Steve & Barry's "fell months behind on $36,000 in bills and still owes $20,326 for ads bought more than a year ago." Knicks G Stephon Marbury, Cavaliers C Ben Wallace, Sony Ericsson WTA member Venus Williams and surfer Laird Hamilton are among the personalities who have "cut exclusive licensing deals with the company" (WALL STREET JOURNAL, 6/26).
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