Parent company of Herberger's could be headed for liquidation
The future looks bleak for Bon-Ton Inc., the parent company of department stores like Herberger's, Younkers and Elder-Beerman.
A court-supervised auction of the bankrupt business started Monday. According to the Reuters news agency, sources familiar with the matter said the only bidders were liquidators. If the U.S. Bankruptcy Court in Wilmington, Delaware, approves the sale of Bon-Ton to a liquidator, it could mean the closure of all Bon-Ton stores, including Herberger's, which has stores across Minnesota, North Dakota and South Dakota. It also puts at risk thousands of retail jobs.
A court decision could be made as early as Wednesday, media reports said.
Bon-Ton had been working with U.S. mall owners Namdar Realty Group and Washington Prime Group Inc., Reuters reported, in a hope to secure a bid that would have kept many of Bon-Ton's stores open. However, neither one of the groups bid at the auction Monday, reports said.
Bon-Ton filed for voluntary Chapter 11 bankruptcy in early February, according to a Feb. 4 news release from the department store company. It continued operation as it entered the bankruptcy process, though it did announce the closing of 47 stores at that time.
Bon-Ton has not commented on the reports from Monday's auction. Stock in the company has been low for months. With the news of the possible liquidation, it has fallen even further, with shares worth only a few pennies.
Bon-Ton is headquartered in York, Pa., and Milwaukee. According to its website, the company operates 254 stores in 23 states.
Herberger's was founded in Minnesota, with its first store opening in Osakis.