Steve & Barry's to close Cape location
Friday, August 29, 2008
The Steve & Barry's discount clothing store in West Park Mall in Cape Girardeau will be closing, company officials confirmed Thursday afternoon.
"BHY S&B Holdings announced that it intends to run a smaller base of Steve & Barry's stores, better positioning the company to reach its profitability goals," company spokesman Howard Schacter said in a written statement.
The company had no comment on when the Cape Girardeau store would close or the fate of the employees.
West Park Mall officials declined to comment.
Steve & Barry's was purchased Tuesday for $163 million by BHY S&B Holdings LLC, a newly formed affiliate of investment firms Bay Harbour Management and York Capital Management. The company had filed for Chapter 11 bankruptcy protection July 9.
Under the terms of the purchase agreement, the majority of the 276 Steve & Barry's stores in 39 states will continue to serve customers, offering collections created with entertainers and athletes such as Sarah Jessica Parker, Venus Williams, Amanda Bynes, Laird Hamilton, Ben Wallace and Bubba Watson. All of the celebrities maintain a licensing relationship with Steve & Barry's.
BHY S&B Holdings has a history in turnarounds of troubled or bankrupt corporations. The company's holdings include the former Aladdin Casino, which now operates in Las Vegas as Planet Hollywood Resort and Casino, and Barneys New York.
The 80,000-square-foot store first opened in Cape Girardeau on Oct. 14, 2005, occupying an anchor spot that had sat vacant since ShopKo closed its doors in 2001. At the time of its opening, the store had 67 stores in 26 states, with plans to open another 70 by the end of 2005.
But by July 1, The Wall Street Journal reported that the company was considering closing as many as 100 stores in the near future, if it did not find emergency financing. According to the Journal, Steve & Barry's business model depends on one-time large cash payments to the company from mall operators to open stores on their properties. The total profit margin for the company's $1 billion in annual sales was 1 to 3 percent, the Journal reported, and those profits began drying up as retail property owners retrench in the uncertain economy.
While company officials did confirm the Cape Girardeau store would close, they had no comment on the fate of its other underperforming stores.
335-6611, extension 137