THROWING IN THE TOWEL STROUDS FILES FOR BANKRUPTCY WITH FINAL SALES STARTING TODAY AT 47 LOCATIONS.Byline: Gregory J. Wilcox and Brent Hopkins Staff Writers CITY OF INDUSTRY - Financially struggling housewares house·wares pl.n. Cooking utensils, dishes, and other small articles used in a household, especially in the kitchen. retailer Strouds Acquisitions Inc. has filed bankruptcy for the second time in three years and will shut 47 stores in four states and lay off 1,100 workers, company officials confirmed Wednesday. ``This is liquidation. ... They will be finished,'' said Andy Wiederhorn, chief executive officer of Portland, Ore.-based Fog Cutter Capital Group, which loaned Strouds $2.9 million in exchange for 49.5 percent controlling interest controlling interest The ownership of a quantity of outstanding corporate stock sufficient to control the actions of the firm. Controlling interest often involves ownership of significantly less than 51% of a firm's outstanding stock because many owners fail in the company. Westlake Village-based Tiger Capital Group will handle the liquidation, along with Needham, Mass.-based The Ozer Group and Great Neck, N.Y.-based SB Capital Group. After the bankruptcy court bankruptcy court n. the specialized Federal court in which bankruptcy matters under the Federal Bankruptcy Act are conducted. There are several bankruptcy courts in each state, and each one's territory covers several counties. approved the plan late Wednesday, sales at the 31 regular stores and 16 outlets will begin today. ``I just called my people and told them to start putting up the signs and to get ready for the sales,'' said Albert Nassi, managing member of Tiger Capital. ``We'll sell it until it's all gone.'' Strouds' dire financial situation forced it to proceed at a fast pace. ``It's happening very quickly because they need to start making money very quickly,'' Nassi said. ``They've basically run out of money, and they need to stop the bleeding. I don't know Don't know (DK, DKed) "Don't know the trade." A Street expression used whenever one party lacks knowledge of a trade or receives conflicting instructions from the other party. what happened to them. Obviously, competition is a huge problem in the industry right now.'' Company President Robert Valone offered little insight into the company's woes. ``We don't really have any one specific thing that's happened,'' he said. Employees of City of Industry-based Strouds were notified of the decision Tuesday. San Fernando San Fernando, city, Argentina San Fernando (săn fərnăn`dō), city (1991 pop. 144,761), Buenos Aires prov., E Argentina. It is a district administrative center in the Greater Buenos Aires area. Valley-area stores are in Glendale, Studio City, Woodland Hills, Northridge and Thousand Oaks Thousand Oaks, residential city (1990 pop. 104,352), Ventura co., S Calif., in a farm area; inc. 1964. Avocados, citrus, vegetables, strawberries, and nursery products are grown. . ``The game plan was to see if we could make it work, because it's been troubled for some time. Apparently, we couldn't make it work,'' said Wiederhorn, whose company is Strouds' largest shareholder and creditor. The chain was founded in 1979 by Wilfred Stroud, opening its first store in Pasadena. It grew to more than 1,500 employees and more than 70 locations across the country until competition from home furnishings sellers like Bed Bath & Beyond and Linens 'n Things Linens 'n Things, Inc., headquartered in Clifton, New Jersey, is the second-largest large-format retailers of home textiles, housewares and decorative home accessories in the United States, behind Bed Bath & Beyond. drove the company into bankruptcy protection in September 2000. A year later, Cruttenden Partners, a Newport Beach-based investment group, took the chain private. Founder Walter W. Cruttenden III became Strouds' chairman. He referred calls to company executives. Late last year, Strouds implemented an aggressive $10 million marketing campaign, targeting consumers between the ages of 25 and 45, a group largely unfamiliar with the company and its products. Strouds also broadened its product line and started in-store decorating seminars. It didn't work, though, and Jack Kyser, chief economist The Chief Economist is a single position job class having primary responsibility for the development, coordination, and production of economic and financial analysis. It is distinguished from the other economist positions by the broader scope of responsibility encompassing the for the Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. County Economic Development Corp., is not surprised. This segment of the market is weighed down by massive overcapacity o·ver·ca·pac·i·ty n. Too great a capacity for production of commodities or delivery of services in relation to actual need: the problem of overcapacity in many large industries. , and Strouds got squeezed by department stores This is a list of department stores. In the case of department store groups the location of the flagship store is given. This list does not include large specialist stores, which sometimes resemble department stores. and discount chains. Also, some stores suffered from marginal locations and were hard to find, he said, and competitors who copied the concept did a better job of executing it. ``This concept did not age well,'' Kyser said. ``It's bad news for the real estate owners who are going to have to fill some space, and it's very bad news for the people who work at Strouds and the people that provide goods and services In economics, economic output is divided into physical goods and intangible services. Consumption of goods and services is assumed to produce utility (unless the "good" is a "bad"). It is often used when referring to a Goods and Services Tax. to them.'' Staff Writer Don Jergler contributed to this report. CHRONOLOGY --1979 Wilfred Stroud founds firm, opens first store in Pasadena. --2000 Chain files for Chapter 11 bankruptcy in September, closes more than 20 locations, gets delisted from Nasdaq stock exchange. --2001 Cruttenden Partners acquires Strouds, takes it private. --2003 Fog Cutter Capital Group supplies a $2.9 million emergency loan in March; chain files for bankruptcy May 20, 2003. Brent Hopkins, (818) 713-3738 brent.hopkins(at)dailynews.com CAPTION(S): photo, 2 boxes Photo: (color) Strouds will close this Woodland Hills store and 46 more soon, laying off 1,100 workers in four states, company officials say. Competition by Bed Bath & Beyond and Linens `n Things drove the home store out of business. Joe Binoya/Staff Photographer Box: (1) CHRONOLOGY (see text) (2) STROUDS FOLDS SOURCE: Daily News research Daily News |
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