The parent company of Herberger’s has begun notifying states that it may close stores, including at least three in the Twin Cities, if it isn’t able to soon secure a buyer for the bankrupt chain.
Bon-Ton Stores notified Minnesota’s economic development department that it may shutter the Herberger’s stores in Bloomington, Roseville and Stillwater. More than 500 employees could lose their jobs as a result, starting in June.
A Younkers store in Duluth, which is part of the same company, might also be shuttered.
“We are required to provide notification under certain state and federal laws of potential job losses even as we work diligently to complete a sale of the company as a going concern,” the company said in a statement.
“Bon-Ton is in active discussions with an investor group to acquire the company in a court-supervised sale process. We are encouraged by the interest in Bon-Ton, and we hope that jobs will be preserved.”
Earlier this week, Reuters reported that U.S. mall owners Namdar Realty Group and Washington Prime Group were in talks to acquire the retailer. But if those talks are not successful, liquidators are prepared to move in and dismantle the company.
Last week, Bon-Ton extended the deadline for bids to Wednesday after announcing it was in active discussions with an unidentified bidder.
Like many other department-store chains, Bon-Ton has been struggling as consumers gravitate to shopping online and at off-price outlets such as TJ Maxx.
The retail industry, which saw a massive number of store closings and bankruptcies last year, continues to see more disruption this year. Toys ‘R’ Us is in the midst of store-closing sales and Nine West filed for bankruptcy on Friday.
Last month, Bon-Ton closed a Herberger’s clearance center in Maplewood, one of 47 stores Bon-Ton had initially announced it would close this year. The company had 260 stores at the time that operate under various names that include Bon-Ton, Bergner’s, Boston Store, Carson’s, Elder-Beerman, Herberger’s and Younkers.
The Herberger’s store at Rosedale Center was just remodeled last year. The company then sold that store and leased it back to help reduce its debt.
“This sale-leaseback transaction unlocks additional capital, enabling us to repay debt and enhances our overall liquidity position,” Chief Executive William Tracy said in a statement last year. “Our team looks forward to continuing to serve customers in the Roseville area for many years to come.”
Other Herberger’s locations in the Twin Cities include Edina, Blaine and St. Paul.