Kmart may be closing stores

Manager of Craig store says company may be restructuring

Advertisement

Despite rumors of massive lay-offs and store closures, management at Craig's Big Kmart is confident that the store's 85 employees will not be affected in the near future.

"We've been through tough times before, and we'll handle this well. The reality of the situation is that the company will not go bankrupt," said Big Kmart assistant store manager Mark Curtis. "We're the second largest retailer in the nation with more than 300,000 employees. If anything, Kmart will restructure."

According to an Associated Press report, shares of Kmart Corp. plunged close 10 14 percent Tuesday, fueled by concerns over a possible bankruptcy filing amid a series of downgrades by analysts and investment rating agencies.

Shares fell 39 cents to close at $2.45 on the New York Stock Exchange.

Kmart spokesman Jack Ferry confirmed that the company's board of directors was holding a previously scheduled meeting Tuesday and also held committee meetings Monday.

Ferry declined to say what the board was discussing, but sources close to the company said board members were discussing the retailer's financial choices, including a bankruptcy filing.

"I think they are looking at their liquidity options, and their options of closing stores," said Marie Driscoll, an analyst at August Research, an independent investment firm.

Driscoll and other analysts expect that Kmart, the nation's third-largest discounter behind WalMart Stores Inc. and Target Corp., could close as many as 400 of its approximately 2,100 stores. Kmart has 34 stores in Colorado, including Big Kmarts and Super Kmarts.

"Kmart will not go bankrupt flat out like Country General did," Curtis said. "They will explore other avenues of bankruptcy that wouldn't involve liquidation."

As far as the overall financial status of the company, very little is known according to Curtis.

"I really can't comment on the situation at the store level," Curtis said. "What I can tell you is that our employees are curious about what's going on, but the anxiety level isn't too high. I think our employees are confident that there is no risk at this store."

Commenting has been disabled for this item.