Eddie Bauer Begins Bankruptcy Proceedings
Eddie Bauer became the latest high profile corporate entity to buckle under recession when it filed for bankruptcy on Wednesday. The retail company declared that it was being compelled to declare bankruptcy under pressure of enormous debt payments and sharp drop in customer spending.
Eddie Bauer Holdings Inc is believed to have lost almost half a billion dollars in the past three years. As of May this year, the retailer reported running up $289.5 million in debt which includes $187.8 million in term loans and another $75 million in convertible notes in the fiscal year 2008 the company reported net losses of $165.5 million while in the first quarter ending April this year, it had incurred another $44.5 million in net losses.
Eddie Bauer’s declaration of bankruptcy is the latest instance in a wave of several major retailers falling prey to the deep and prolonged recession. Among other retailers to have downed shutters in the past few months are Linen n Things, Circuit City and Joe’s Sports and Outdoors. Most retailers, barring the discount ones like Wal-Mart, have suffered a steep drop in retail revenue across the board while specialty retail departments have come off worse with some of them incurring double-digit, same-store losses.
