Zale, filing Chapter 11, shuts 4 stores in region

January 25, 1992|By Michael Dresser

The troubled Zale Corp. jewelry store chain has closed at least four of its Baltimore-area stores, including three at the already hard-pressed Hunt Valley Mall.

Zale, which filed a petition for Chapter 11 bankruptcy protection Thursday, closed its Zales, Gordons and D. P. Paul stores at Hunt Valley Mall this week, along with its Bailey Banks & Biddle store at Owings Mills Town Center. It was not clear how many employees lost jobs.

Karen Jones, a spokeswoman for Zale, said she did not know if other company-owned stores in the Baltimore area had closed or would close.

It was not clear whether the closings were part of a broader restructuring announced Dec. 30 to close 400 of the company's 2,000 stores.

Zale described its filing for Chapter 11 reorganization in U.S. Bankruptcy Court in Dallas as voluntary, but the company was pushed to take the step this month after four bondholders filed an involuntary petition against the company after payment deadlines passed.

The company, based in Irving, Texas, sought Chapter 11 protection for 15 operating subsidiaries and announced that $510 million in debtor-in-possession financing would be provided by Chemical Bank.

Those filings listed combined assets of more than $946 million and liabilities of $840.7 million.

Zale, with about $1.5 billion in debt, is owned by Peoples Jewellers Ltd. of Toronto and Swarovski International AG of Switzerland.

Ms. Jones said that closed stores would post signs telling customers where to pick up items being repaired or held on layaway and that Zale would contact those customers.

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