SAN FRANCISCO – Gottschalks Inc. says it put itself up for sale and has filed to reorganize in a Chapter 11 bankruptcy.
The regional department store chain, which operates a store on East 29th Avenue in Spokane, has negotiated a $125 million debtor-in-possession financing from a group of lenders led by GE Capital, it said Wednesday. The financing, if approved in bankruptcy court, will fund wages and benefits, some vendor payments and other operating expenses while it reorganizes.
“Persistent challenges in the economy and recent unexpected reductions to our borrowing capacity as a result of tightening credit markets have left us with no other recourse,” Jim Famalette, chairman and chief executive, said in a statement.
Gottschalks operates 58 department stores and three specialty clothing stores in Washington, Idaho, Oregon, California, Alaska and Nevada. It also has stores in Moses Lake, Walla Walla and Lewiston.