Regional department store chain Gottschalks Inc. (GOTTQ.PK), which filed for bankruptcy protection in January, is in talks with three potential buyers who would continue to run the company's business, Bloomberg reported Thursday, citing two people with knowledge of the matter.
According to the Bloomberg report, the three potential buyers, namely, California-based private equity firm Golden Gate Capital Corp., Illinois-based real estate development company GK Development Inc. and Spanish retailer El Corte Ingles, will retain some of Gottschalks' locations.
The three companies reportedly signed confidentially agreements that allow them to view Gottschalks' financial records. However, the companies have not committed to bid in the auction scheduled for March 30, the report noted.
In mid-January, the Fresno, California-based Gottschalks filed to reorganize under Chapter 11 of the United States Bankruptcy Code and added that it has determined to pursue various options, including sale of its business or another transaction with a third-party investor. The company attributed the move to persistent challenges in the economy and recent reductions to its borrowing capacity due to tightening credit markets.
In early March, Gottschalks said it received approval from the bankruptcy court to extend its auction date until March 30, 2009, to allow for further negotiations related to potential going concern offers. Further, the company said it remains in active discussions with multiple potential buyers and continues normal business operations in its stores.
Also in March, Gottschalks said that a group of liquidators comprised of SB Capital Group LLC, Tiger Capital Group LLC, Great American Group LLC and Hudson Capital Partners LLC, was designated the lead, or stalking horse" bidder.
A "stalking horse bidder" is chosen by the distressed company from a pool of bidders and makes the lead bid at a bankruptcy auction, creating a floor for the bidding, in return for certain protections including break-up fees.
In the event the liquidators win the auction, they will conduct going-out-of-business sales at Gottschalks' retail stores and distribution center. The sale will commence on or about April 3, 2009 and will be completed on or before July 15, 2009.
In a filing with the U.S. Securities and Exchange Commission, or SEC, Gottschalks said it is guaranteed to receive, irrespective of actual sale proceeds, 85% of the aggregate cost value of the merchandise to be sold, in addition to an amount sufficient to cover certain company expenses during the term of the sale.
Gottschalks currently operates 58 department stores and three specialty apparel stores in six western states, including California, Washington, Alaska, Oregon, Nevada and Idaho.
GOTTQ.PK closed Thursday's trading session at $0.13, up $0.05 or 73.33% on a volume of 80,172 shares.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.