Linens 'N Things throws in towel, files for bankruptcy

Charles Rex Arbogast, Associated Press

Customers leave a Linens ' n Things store in Chicago Friday, May 2, 2008. The bedding and home-furnishing retailer filed for Chapter 11 bankruptcy protection Friday at bankruptcy court in Delaware and said it would close 120 under performing stores.

The store's parent company blamed the recent credit crunch and the downturn in the housing market as the reason it filed its voluntary Chapter 11 petition in U.S. Bankruptcy Court. It will close stores in the Woodbury Lakes shopping center and the Apache Shoppes in Rochester.

By TIM HARLOW, Star Tribune

Last update: May 2, 2008 - 10:52 PM

The parent company of home furnishings specialty retailer Linens 'n Things filed for Chapter 11 bankruptcy today and said it will close 120 stores nationwide, including two in Minnesota.

Stores in the Woodbury Lakes shopping center and the Apache Shoppes in Rochester will be shuttered as the Clifton, New Jersey-based Linens Holding Co. attempts to restructure its balance sheet and close under performing stores.

The company blamed the recent credit crunch and the downturn in the housing market as the reason it filed its voluntary Chapter 11 petition in U.S. Bankruptcy Court in the District of Delaware.

"The significant deterioration in the mortgage, housing and credit markets and the resulting impact on the retail marketplace, particularly the home sector, has overwhelmed the operating and merchandising improvements that we have made over the past two years," said Robert J. DiNicola, executive chairman of the company behind Linens 'n Things.

The bankruptcy filing pertains only to the company's operations in the United States. The company's Canadian stores are among its strongest performers and are not included in the filing. There are no plans for a similar filing in Canada, the company said.

Besides the two Minnesota closings, Linens Holding said it will shut 26 stores in California, the most of any state where it does business. Nine stores in Texas and Michigan, seven in New York, six in Ohio and Florida will close, the company said.

Linens 'n Things, with 2007 sales of approximately $2.8 billion, is one of the leading national large format retailers of home textiles, housewares and home accessories. As of Dec. 29, 2007, Linens 'n Things operated 589 stores in 47 states and seven provinces across the United States and Canada.

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