Linens ‘n Things Canada seeks to liquidate assets
Two customers push their purchases to their vehicles after shopping at the Southpointe Common location of Linens ‘n Things in Red Deer on Tuesday: Linens ‘n Things Canada’s 40 stores may soon begin closing sales.
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It was business as usual at the Red Deer outlet of Linens ‘n Things on Tuesday, but a dark cloud hung over the bedding and home-furnishing retailer.
Linens Holding Co. announced this week that its Canadian subsidiary, Linens ‘n Things Canada, has applied for bankruptcy protection. The company said in a statement that it is seeking approval to liquidate its Canadian operations and expects the matter to be heard in court “in the next week.”
Linens Holding filed for United States bankruptcy protection in May and received approval to sell Linens ‘n Things’ U.S. assets to a joint venture group. That group is currently liquidating the inventory through closing sales at the remaining 371 U.S. Linens ‘n Things stores.
If Linens ‘n Things Canada’s application is approved, the 40 stores in this country will be included under the liquidation agreement and closing sales conducted.
“Since our bankruptcy filing in the United States in early May, (Linens Holding) and our advisers have worked tirelessly to develop a viable restructuring plan for the company,” said Michael Gries, chief restructuring officer and interim CEO, in the statement.
“Unfortunately, the worsening economic situation in the U.S., the deepening decline in the real estate market, the further downturn in consumer spending and the frozen credit markets combined to make this sale of assets the best vehicle to satisfy our creditors.
“This is a difficult day, especially since our Canadian stores were among the best performing stores. . . .”
Linens ‘n Things had sales of approximately $2.8 billion in 2007. Among its Canadian stores were five in Calgary, two in Edmonton and one each in Lethbridge and Red Deer.
The Red Deer store opened in Southpointe Common in May 2005.
A call by the Advocate to that store on Tuesday was referred to American public relations firm MWW Group. An official there said no additional information was available at this time.
