- Mississippi textiles seller could file as soon as this month
- Move would be the company's second trip to bankruptcy court
Hancock Fabrics Inc., a retail chain that sells sewing supplies, is preparing for a second trip to bankruptcy court, according to two people with knowledge of the situation.
Barring a last-minute reprieve, the company could take the step as soon as this month, said the people, who asked not to be identified because the process isn’t yet public. The Baldwyn, Mississippi-based company previously filed for bankruptcy in March 2007, soon after announcing it would close about 100 stores. The retailer re-emerged the following year.
Hancock included a warning about its ability to continue as a going concern in its third-quarter filing late last year. The money-losing retailer had about $3 million in cash in the quarter ended Oct. 31. At the time, the company operated about 260 stores in 37 states, along with an e-commerce site. It cited “intense” competition in its sector, where competitors include Wal-Mart Stores Inc. and Michaels Stores Inc., along with online merchants like Amazon.com Inc. Long-term debt at the quarter’s end was $99.4 million.
The company didn’t immediately respond to requests for comment.
Hancock Fabrics shares fell 54 percent to less than 6 cents at the close in New York on Thursday. The stock lost 90 percent of its value last year.