Gordmans Stores is Reportedly Preparing to File for Bankruptcy

by San Antonio Attorney

Ohama-based Gordmans Stores Inc. is reportedly taking steps to file for bankruptcy, the Bloomberg reported citing sources.

The century-old chain of department stores is said to be filing in March.  The company’s shares have dropped over 75% in 2016, sustaining losses for the past 18 months.

The Midwestern retailer would become the most recent casualty in the struggling U.S. retail industry.  The shift of consumers’ preference from mall shopping to online shopping has greatly affected department stores, which includes local chains that used to have great customer loyalty.  Big competitors like as Sears Holdings Corp., Macy’s Inc. and J.C. Penney Co. are also shuttering many brick and mortar stores to cope with the sluggish sales.

Gordmans was founded by Sam Richman, a Russian immigrant, in 1915.  He opened a garments store in Omaha.  He partnered with Dan Gordman, a former executive of Bloomingdale who married Richman’s daughter.

The Richman Gordman expanded to over 100 stores in 22 states.  In 2008, Sun Capital Partners bought the chain and took it public in 2010.

But Gordmans has been struggling since for the past years.  Its losses started to grow in 2014, incurring about $85 million in debt.

In 2016, the company’s stock price dropped under $1.  The company was threatened to be delisted by the Nasdaq Stock Market threatened.  It has until May to comply with the rules for listing.

The company’s stock fell by 42% after it was reported that Gordmans is likely to file for bankruptcy.

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