Shoe Retailer Bakers Footwear Files for Bankruptcy in Missouri
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Shoe Retailer Bakers Footwear Files for Bankruptcy in Missouri

October 29, 2012

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Bakers Footwear Group, a popular chain of shoe stores that are typically found in malls, is filing for bankruptcy due to declining revenues, according to a Washington Post report.

In addition to its Chapter 11 bankruptcy filing, which took place in U.S. Bankruptcy Court in St. Louis, the company has also announced its decision to close several stores and lay off a wave of employees.

In its bankruptcy petition, Bakers told the court that it has nearly $60 million in debt, compared with $41.9 million in assets, according to sources.

The shoe chain, which is based in St. Louis, plans to close at least 25 stores, and it is also trying to sell certain leases and inventory to Aldo Inc. for a little more than $6 million, sources say.

The sale of a large chunk of the company’s assets would help the Bakers raise at least $8 million, and reduce overall expenses by a similar amount.

The company is also planning to dump a significant portion of its non-Bakers brand, and focus solely on Bakers models of shoes, which include boots, sandals, and non-footwear accessories.

By streamlining its operations, the company hopes to boost sales at its 193 remaining locations. In order to fund its operations while it goes through the bankruptcy process, Bakers is looking for emergency relief from outside investors.

This week, the company asked the bankruptcy court’s permission to accept a $22 million loan from Crystal Financial LLC, which would allow Bakers to remain in business during bankruptcy, and give it a boost to help recover its financial health.

But even if Bakers secures the additional financing, it will still have to improve its lagging sales numbers. Sources say the company’s overall sales dropped 11 percent this year, while same-store sales fell by 7.5 percent.

And the company owes money to a wide range of creditors, including several shoe wholesalers, as well as a handful of banks. So there are many mouths to feed before the store reaches the sales figures it experienced before the recession struck.


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