Shopko said it will file for Chapter 11 bankruptcy protection and close 38 additional stores due to excessive debt and growing competitive pressures.

Shopko, which operates about 40 stores in Minnesota, is reporting assets of less than $1 billion and liabilities of between $1 billion and $10 billion. Founded in 1962, Shopko is a $3 billion retailer that operates in 26 states.

"This decision is a difficult but a necessary one," Chief Executive Russ Steinhorst said in a statement. "In a challenging retail environment, we have had to make some very tough choices, but we are confident that by operating a smaller and more focused store footprint, we will be able to build a stronger Shopko that will better serve our customers, vendors, employees and other stakeholders through this process."

Shopko plans to continue operating through Chapter 11 reorganization after securing $480 million in financing from a group of lenders led by Wells Fargo Bank. The financing will allow Shopko to continue to pay employees, vendors and suppliers.

Last month, the Green Bay, Wis.,-based retailer announced it would close 40 of its more than 300 locations.

Minnesota stores affected in the latest closings include two full-sized stores, in Fairmont and on Hwy. 63 in Rochester. Three smaller concept stores in Mahnomen, Warroad and Paynesville also will close. The closing date for the Mahnomen and Paynesville locations is March 3. The other Minnesota stores will exit the market by April 15.

Sixteen stores in Wisconsin also are being shuttered.

The Associated Press contributed to this report. John Ewoldt • 612-673-7633