One of Wisconsin’s legacy retailers said Wednesday morning that it has filed for Chapter 11 bankruptcy protection and will close 38 more stores.
Green Bay area-based Shopko, with 360 stores in 26 states, including a large presence in Wisconsin, said it is restructuring “as a result of excess debt and ongoing competitive pressures.”
It was announced last week, that the Shopko on La Crosse’s North Side was closing. No other La Crosse area stores are affected by Wednesday’s announcement, including Winona and Arcadia.
The company, has obtained $480 million in debtor-in-possession financing to help fund and protect its operations through the Chapter 11 process. The funds will be used to pay suppliers, vendors and other business partners. The bankruptcy was filed Wednesday in the U.S. Bankruptcy Court in the District of Nebraska.
“This decision is a difficult, but necessary one,” Russ Steinhorst, Shopko’s CEO said in a news released posted on the company’s website. “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.”
Shopko announced late last year the closing of 39 stores in 19 states by the end of this February, including a store in Mauston.
Last week the company added six more Wisconsin stores to the closure list in Appleton, Grafton, La Crosse’s North Side, Menasha, Seymour and Sussex.
In addition to closing stores, Shopko has also been selling its pharmacy operations and has its headquarters building in Ashwaubenon for sale for $24.3 million, according to the Green Bay Press-Gazette.
The company also announced on Wednesday that it will relocate over 20 optical centers to freestanding locations and conduct an auction for its remaining pharmacy business. However, the company said that based on the performance of its four, free-standing optical centers, it plans to expand that arm of the business by opening additional freestanding Optical locations this year.
Shopko was founded by pharmacist James Ruben in Green Bay in 1962.
By 1971, Shopko had 10 stores and 10 years later, in 1981, opened its 30th store, located on Madison’s Far West Side. Shopko now has 126 larger format stores, 234 HomeTown locations, five Shopko Express Rx stores, six Shopko Pharmacy locations and four Shopko optical stores.