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Shane Co. files for Chapter 11

January 13, 2009

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Shane Co. CEO Tom Shane is confident that the company will emerge from Chapter 11 bankruptcy protection "a stronger and healthier company that will be well-positioned to reach its full potential."

Denver--Centennial, Colo.-based jewelry chain Shane Co. filed for Chapter 11 bankruptcy protection earlier this week, becoming the latest industry member to experience financial woes amid the economic downturn.

In a statement released on Monday, Shane Co. said disappointing holiday sales and a lack of liquidity forced the company to seek bankruptcy protection. The company statement said, however, that the retail chain plans to continue to operate the business without interruption as management focuses on developing and executing a comprehensive restructuring plan that can pull the business out of bankruptcy.

"The severity of his past holiday season dramatically impacted existing liquidity requiring the company to seek this bankruptcy protection," Shane Co. Chief Executive Officer Tom Shane said in the statement. "I am confident that this action will guarantee that our customers will continue to enjoy the top-notch service, expansive selection and unbeatable prices that they have enjoyed since the days of my grandfather. Furthermore, by taking this action, I can provide job security to local employees. I know that we will emerge from this situation as a stronger and healthier company that will be well-positioned to reach its full potential."

According to court documents filed in U.S. Bankruptcy Court for the District of Colorado in Denver, the jewelry chain claims an estimated $100 million to $500 million in assets but also an estimated $100 million to $500 million in debt.

Filing for Chapter 11 bankruptcy protection frees a company from the threat of creditor's lawsuits while it reorganizes.

Court documents show that among Shane Co.'s top 20 creditors are diamond companies Leo Schachter Diamonds and Eurostar Belgium, as well as Hong Kong-based Man Sang Jewellery Co.

The family-owned company, also known through the years as Western Stone and Metal Corp. and Midwestern Stone and Metal Corp., operates 25 stores in 17 states, according to National Jeweler's 2008 State of the Majors report. As part of the State of the Majors report, Shane Co. is listed as 29th on the "Top 50" list, which ranks North American retail jewelry chains in terms of store count.

Its stores are spread throughout the West, Midwest and southern United States.
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Business | Company Activities and Information | Company Bankruptcies

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