Shopko announced today that the company has filed voluntary petitions for a court-supervised financial restructuring under Chapter 11 of the United States Bankruptcy Code.
In a press release, the company says they need to restructure due to excess debt and ongoing competitive debt. The petitions have been filed in the U.S. Bankruptcy Court for the District of Nebraska.
Shopko has obtained up to $480 million debtor-in-possession financing from secured lenders to help fund and protect its operations during the Chapter 11 process.
CEO Russ Steinhorst says this decision was difficult but necessary. “In a challenging retail environment, we have had to make some very tough choices, but we are confident that by operating a smaller and more focused store footprint, we will be able to build a stronger Shopko that will better serve our customers, vendors, employees and other stakeholders through this process.”
Additionally, it was announced today that Shopko will be closing an additional 38 stores. Last month the Kimball Shopko was announced as one of the 39 stores facing closure by the retailer.
Currently, there are Shopko locations in Alliance and Torrington serving people in the region. Locations in Gordon and Ogallala were set to close by the end of 2018.
In a subsequent release, Shopko officials says their stores will continue to be open and offer the high-quality products that their customers are accustomed to.