Retailer Coldwater Creek going out of business

Coldwater Creek Inc., a 362-store women’s clothing chain that has four stores in Indianapolis-area malls, filed a Chapter 11 petition Friday to liquidate inventory in going-out-business sales to begin in time for Mother’s Day.

The retailer has stores at the Fashion Mall at Keystone, Greenwood Park Mall, Hamilton Town Center in Noblesville, and Metropolis in Plainfield.

It has four other stores in Indiana, in Edinburgh, Evansville, Fort Wayne and Granger.

Listing assets of $278.5 million and debt totaling $361.3 million, the Sandpoint, Idaho-based company tried without success to find a buyer or investor.

Coldwater intends to hold an auction on May 1 to select the liquidator. The first bid will be submitted by a joint venture between Hilco Merchant Resources LLC and Gordon Brothers Retail Partners LLC.

Acting as agents, they guarantee Coldwater will recover at least 97 percent of the cost of the merchandise, estimated to have a total cost of $90 million to $100 million. Once the liquidators recover expenses of the sale, the guaranteed amount, and an 8.5-percent fee based on the cost of merchandise, they will split the excess 50-50 with Coldwater.

The proposed schedule calls for a hearing to approve sale procedures on April 23, followed by the submission of competing bids by April 28, an auction on May 1, and a sale-approval hearing by May 6.

At their peak in 2006, Coldwater’s sales were $1.1 billion. For the nine months ended Nov. 2, sales of $460 million translated into a $61.3 million operating loss and a $59.6 million net loss.

For the fiscal year ended Feb. 1, 2013, sales of $742.5 million brought a $68.7 million operating loss and an $81.2 million net loss.