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Off-price retailer Stein Mart is the latest in a long list of businesses to file for bankruptcy protection amid the coronavirus pandemic.
The Jacksonville, Florida-based retailer said Wednesday it plans to “close a significant portion, if not all, of its brick-and-mortar stores” and has “launched a store closing and liquidation process,” according to a news release announcing the Chapter 11 filing.
The company operates 281 stores in 30 states and all stores will continue to operate during the Chapter 11 process. It has 9,000 employees.
“Our going-out-of-business sale is expected to begin in our stores August 14 or 15,” the company told USA TODAY in a statement. “We anticipate all stores will close by the fourth quarter of 2020, with closing dates varying by store.”
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The company is evaluating alternatives, including the potential sale of its eCommerce business and related intellectual property.
“The combined effects of a challenging retail environment coupled with the impact of the Coronavirus (COVID-19) pandemic have caused significant financial distress on our business,” CEO Hunt Hawkins said in the release. “The Company has determined that the best strategy to maximize value will be a liquidation of its assets pursuant to an organized going out of business sale.”
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Department stores and apparel retailers have been grappling with declining foot traffic for years but the impact of the pandemic has led many retailers to accelerate store closings and bankruptcy filings.
As many as 25,000 stores could shutter this year as businesses continue to feel the impacts of the pandemic, according to a recent report from Coresight Research.
Since May, Ascena Retail Group, parent company of Justice, Ann Taylor and Lane Bryant, New York & Company‘s parent company RTW Retailwinds, Lucky Brand, J.C. Penney, Brooks Brothers, Sur La Table, Neiman Marcus, Tuesday Morning, Tailored Brands, GNC, Lord + Taylor and J. Crew have all filed for Chapter 11.
Stein Mart’s bankruptcy is one of many steps the company has taken to remain viable.
The publicly traded company’s board agreed in January to be taken over by a private company, but that deal with Kingswood Capital Management was put on ice when the pandemic threw the business world into turmoil.
The company’s stock price has fallen throughout the year, dropping from $0.67 when the year started to $0.29 on Tuesday. The stock fell Wednesday to $0.17.
The company said in June it had landed $10 million in aid through the federal Paycheck Protection Program but the business acknowledged this week that it had laid off a number of employees at its Southbank headquarters.
The company, which was founded in Mississippi in 1908, became a regional retail power in the 1970s and had grown to more than 100 stores in the 1990s, but has struggled like many retailers as the shopping environment changed.
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Contributing: Steve Patterson, Florida Times-Union
Follow USA TODAY reporter Kelly Tyko on Twitter: @KellyTyko
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