Service Merchandise Board Approves Chapter 11 FilingThe board of Service Merchandise, Nashville, TN, voted in favor of filing Chapter 11 bankruptcy protection with the U.S. Bankruptcy Court in the Middle District of Tennessee yesterday following a petition Monday night by five of its key vendors.
Service Merchandise which employs about 25,000 people, has experienced continued financial problems in recent years. And just last month the company made a decision to close over 100 stores followed by an announced layoff of 300 employees two weeks ago.
But yesterday the struggling cataloger said that it expects to keep all remaining retail outlets open and running without interruption from this point forward unless the court orders it to act otherwise. It also indicated that Citicorp U.S.A., the company's revolving credit facility would continue with its extension of $50 million in credit in the face of the involuntary filing.
In published reports, Bettina Whyte, CEO was quoted as saying "Our stores will be open for business as usual. We intend to operate our businesses vigorously and to meet our customers' needs."
She also assured that the company's payroll would be met and that there would be no disruption in shipping of customer orders.