By Jonathan Stempel
NEW YORK (Reuters) - Gracious Home, the retailer of
bed, bath, kitchen and other home furnishings, filed for
bankruptcy protection Friday, after sales fell and losses
mounted as more consumers lost their jobs in a slumping
The company, which operates six stores in Manhattan, joins
a growing list of U.S. retailers that have sought bankruptcy
protection since 2007 amid tight credit conditions and a
recession such as Circuit City, Eddie Bauer, Filene's Basement,
Fortunoff, Linens 'n Things, Mervyn's and The Sharper Image.
Gracious Home was founded in 1963 by Cuban immigrants Natan
Wekselbaum, who remains chairman, and his brother, according to
the company website.
In a filing with the U.S. bankruptcy court in Manhattan,
President Jordan Smilowitz said Gracious Home has had
"substantial" losses for several years, with revenue declining
to an estimated $58 million this year from $60 million in 2009
and $70.4 million in 2008.
He also said Gracious Home struggled because a net loss of
131,000 jobs in New York City since August 2008 hit the
financial and legal industries particularly hard.
"These are the jobs held by many of the debtors'
customers," he said.
The company said it plans to use the bankruptcy process to
restructure its store lease obligations, and obtain new capital
from Meridian Acquisition Ventures LLC, pending a possible
court-supervised auction for better proposals.
It also plans to obtain financing from an affiliate of
NewAlliance Bancshares Inc to keep operating while in
Robert Pressman, a former Barney's Inc chief executive
whose firm Triton Equity Partners LLC advised Gracious Home on
real estate matters, in an interview said Gracious Home plans
to file its reorganization plan next week, and could emerge
from bankruptcy this year.
Thomas Shull, a Meridian principal and restructuring
specialist who also once ran Barney's, would remain Gracious
Home's chief executive and Wekselbaum would remain chairman,
the company said.
According to its bankruptcy petition, Gracious Home has $10
million to $50 million of both assets and liabilities, and
1,000 to 5,000 creditors. The filing includes The Weck Corp,
which does business as Gracious Home, and three affiliates.
The case is In re: The Weck Corp, U.S. Bankruptcy Court,
Southern District of New York, No. 10-14349.
(Reporting by Jonathan Stempel in New York; Editing by Richard
Chang, Bernard Orr and Gunna Dickson)