Baltimore: Frank's Nursery Files for Bankruptcy

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Frank's Nursery files for bankruptcy Lawn and garden retailer plans to close about 24 poorly performing stores Source: Chicago Sun-Times Publication date: 2001-02-21 Arrival time: 2001-02-23

Frank's Nursery & Crafts Inc., a top specialty retailer of lawn and garden products, and its parent company FNC Holdings Inc. filed for Chapter 11 bankruptcy protection from creditors.

The company said the filings with the U.S. Bankruptcy Court in Baltimore will enable it to focus on operating its business and serving customers while developing a plan to reorganize its balance sheet and regain financial strength.

The Troy, Mich.-based company, which is not publicly traded, also said it expects to close approximately 24 poorly performing stores as part of its reorganization. Frank's, with $435 million in sales last year, operated 218 specialty retail stores in 15 states as of Monday, primarily in the Midwest and Northeast, including 33 in Illinois- most of them in the Chicago area. It did not say where the closings would occur.

"During 2000, adverse weather patterns negatively impacted lawn and garden sales across most of our principal markets in the Midwest and Northeast," said Joseph R. Baczko, FNC Holdings chairman and chief executive. "Our planned program of sales of 44 closed stores did not meet our expectations due, in large part, to market conditions late last year. We intend to continue to pursue these sales aggressively."

Frank's Nursery said it obtained a commitment for a $100 million, two-year credit line from a group of lenders led by Wells Fargo Retail Finance LLC. The loans, which are subject to court approval, will help Frank's meet its operating needs and fulfill its obligations under normal terms to suppliers and vendors, the company said.

"The substantial funding commitment we now have obtained should enable Frank's to maintain normal operations through the important months ahead while allowing us to focus on an expeditious reorganization," Baczko said.

For the fiscal year ending Jan. 28, Frank's employed about 1,650 full-time and 4,250 part-time workers, the company said.

Last October, the company announced plans to sell approximately 33 company-owned properties and 9 leased properties to reduce its debt.

Publication date: 2001-02-21

-- Rachel Gibson (rgibson@hotmail.com), February 26, 2001


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