It will close all 73 of its stores across 20 states in the coming weeks due to a $45 million loan default unless it somehow can be saved at the last moment, the Wall Street Journal reported.
The 53-year-old chain’s only Ohio location is at 2264 Miamisburg Centerville Road in Miami Twp. It opened in November 2008, taking up 32,000 square feet of space in a former Kmart store.
The company and its stakeholders have “reached an agreement this week to liquidate the remaining roughly 70 stores unless a buyer emerges within the next week or so,” according to a filing with the U.S. Bankruptcy Court in Wilmington, Delaware last week.
Christmas Tree Shops Inc., which does not sell Christmas trees, rebranded as CTS in 2020. It is a wholly owned subsidiary of Handil Holdings, which purchased it in 2020 from Bed, Bath & Beyond.
“After careful consideration, we determined that availing ourselves of the Chapter 11 process was the best way to address our burdensome liabilities,” Christmas Tree Shops Chairman Marc Salkovitz said in May. “This is strictly a financial restructuring. Our operations are sound.”
“By increasing our financial flexibility, we will be able to focus on continuing to delight our loyal customers with a wide selection of unique goods at affordable prices. We continue to believe that given its storied history and strong customer loyalty, Christmas Tree Shops has tremendous potential, and we remain committed to the long-term success of the business.
According to Salkovitz’s interview with the Wall Street Journal in May, the budgets of Christmas Tree Shop’s core customers have been adversely affected by the rise in inflation.
CBS News reported that Salkovitz testified in court that lenders have asked for closing sales to begin by today “so that we don’t have to pay September rents, because we would be done and out of those stores before the end of August.”
Store officials at the Miami Twp. Christmas Tree Shops location confirmed Thursday that a liquidation sale does start today and added that if a buyer for the discount chain cannot be found by the end of next week, stores will close by the end of August.
At the time of the bankruptcy filing, Christmas Tree Shops said it operated 82 different stores, then announced plans to close 10 locations in Florida, Georgia, Massachusetts, Michigan, New York, Pennsylvania and Virginia.
But defaulting on its $45 million in bankruptcy financing set it on the road to liquidation.
“Unfortunately, circumstances have resulted in the plan really not being able to go forward because quite simply, the debtor doesn’t have the time nor the money to go forward with the plan,” CTS attorney Harold Murphy said during a court hearing last week, the Wall Street Journal reported.
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