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Columbia Business Monthly

Stein Mart Voluntarily Files For Chapter 11 Bankruptcy

Aug 12, 2020 12:21PM ● By David Dykes

By David Dykes

Stein Mart, Inc. (NASDAQ: SMRT) said it has filed for bankruptcy and expects to close a significant portion, if not all, of its stores.

The company has locations in South Carolina, including Greenville.

Stein Mart said it filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Middle District of Florida – Jacksonville Division.

The company said it has filed customary motions with the bankruptcy court that will authorize, upon court approval, the company’s ability to maintain operations, including, among other things, the payment of employee wages and benefits without interruption, payment of suppliers and vendors in the normal course of business, and the use of cash collateral.

Those motions are typical in the Chapter 11 process and the company said it anticipates they will be approved shortly after the commencement of its Chapter 11 case.

The company said going forward:

  • It expects to close a significant portion, if not all, of its brick-and-mortar stores and, it has launched a store closing and liquidation process. The company said, however, it will continue to operate its business in the ordinary course in the near term; and

  • It is evaluating any and all strategic alternatives, including the potential sale of its eCommerce business and related intellectual property.

Said Hunt Hawkins, Stein Mart’s chief executive officer: “The combined effects of a challenging retail environment coupled with the impact of the Coronavirus (Covid-19) pandemic have caused significant financial distress on our business. The company has determined that the best strategy to maximize value will be a liquidation of its assets pursuant to an organized going out of business sale. The company lacks sufficient liquidity to continue operating in the ordinary course of business. I would like to thank all of our employees for their dedication and support.”

Stein Mart operates 281 stores across 30 states.