Hancock fabric stores

Sad news.

marcella

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March 21, 2007 Hancock Files Chapter 11 Hancock Fabrics announced today it has filed a voluntary petition for Chapter 11 relief. Its subsidiaries are also filing for the same relief. The company took the action so it can use the reorganization process to improve the company's operating performance, reduce its secured debt over time, close underperforming locations, and exit Chapter 11.

Hancock has negotiated a consensual $105 million debtor-in-possession financing arrangement with Wachovia Bank, N.A., in which Hancock will gain additional borrowing capacity necessary to operate successfully under Chapter 11. The company is also in the final stages of negotiating an additional loan of up to $17.5 million with another lender.

Yesterday the company announced it was closing 104 stores in addition to 30 store closings it announced on February 8.

Jane Aggers, president and ceo, said, ?The process of reorganizing Hancock Fabrics under Chapter 11 is a necessary step to reposition the company for the future. It allows us to focus our attention and resources entirely on further improving our better-performing stores and right-sizing our back-office operations and distribution center. We intend to complete the reorganization as quickly as possible, while taking the actions necessary to preserve value for our creditors, customers, employees, and other stakeholders.?

Hancock has filed a number of ?First Day Motions? in the bankruptcy court to support its employees, customers, vendors, and other stakeholders. Among other things, the court filings include requests to continue to pay Hancock employees and to fulfill the needs of the company's customers as they relate to gift cards, merchandise returns, classes, and other services.

March 20, 2007 Hancock to Close 104 Stores; Receives Default Notice Hancock Fabrics announced today it is closing 104 stores in addition to the 30 store closings disclosed in a press release dated February 8. The additional closings represent approximately $75 million in annualized sales.

The company has expanded its existing engagement of a national liquidation firm to assist it with the inventory liquidation sales in these stores over the next three to four months. In addition, it has selected a national real estate firm to assist in the disposition of the leases for the closing stores.

Jane Aggers, president and ceo, said, ?We regret the impact that this decision to close stores has on our associates, but we believe it is necessary in order to focus our attention and resources entirely on further improving our stores that are performing well.? According to today's press release, the company is not presently able to reasonably estimate the amount of losses that will occur from this process.

In addition, Hancock reported it has received a notice of default from its bank group due to the previously reported delay in filing its quarterly financial statements for 2006 and due to the company's inability to comply with a financial covenant in the bank credit facility that requires the company to have at least $25 million of excess availability.

In the notice of default, the bank group has indicated its intention to increase the interest rate on borrowings and the fees on letters of credit to the default rates, which are two percentage points higher than normal. In addition, the bank group asserts that it may direct the company's depository banks to transfer all cash deposits to the bank group in order to pay down borrowings under the bank credit facility.

In light of these developments, Hancock is exploring its strategic alternatives in its continuing effort to maximize the value of its enterprise for its stakeholders.

Reply to
Marcella Peek
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The signs were up at my local Hancock's yesterday. :-(

Reply to
KJ

Oh my gosh NO this can't be happening!!! How horrible. I love Hancock's. Sadly enough there aren't that many in my area and the closest one to me is

3 hours away if the traffic is not bad. I hope it doesn't close. I hate that this is happening.

Mika

Reply to
Mika

I'm not the least bit surprised. All the Hancock stores I've ever been in were dirty, messy, and had a bunch of junk that they apparently thought people would use in their homes. Maybe if they'd get back to fabric and lose the junk, they might survive. I'm sad to see them closing so many for one reason, and that is that they sold fabric designed by the kids at St. Judes and sent quilts made from it to the hospital. This will make quite a dent in the number of quilts the hospital receives. Gen

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Reply to
Gen

What a shame! We have a brand-new, bright and airy, clean and fresh Hancock's not too awfully far from me. I hope it's not one of the ones that will close. I'd never seen a Hancock's before this one that didn't smell bad and look worse, but this one is just beautiful.

Reply to
Sandy

Ours was pretty nice too. But it's on the hit list.

Reply to
KJ

Thanks for the heads-up.That is sad news. The last few years I've found much more quilting-friendly fabric there than at Joann's, whose fabric quality just hasn't seemed too good to me, nor the selection either.

Of course, I do have *just* a little cloth around here--it's not like I need anything, esp. now that I'm piecing backs, too (not to mention working too much to have more than a few hours at best each week to do anything with cloth.) Maybe I'll have to get even more judicious about my purchases and stick to online pieces that I really can't resist....

Reply to
dogmom

I just heard from one of our LQS owners that three different fabric reps have told her that Joanns is going to quit carrying quilting fabrics. Now, I know their quilt fabric isn't wonderful. But, not everyone can afford quilt shop quality fabric for charity quilts and kids drag-around quilts. This will hurt fabric manufacturers too, since their market will drop a lot. A lot of our volunteers buy (bought) fabric at WalMart and Joanns.

I remember hearing when Joanns bought out House of Fabrics that the owner wanted to have the biggest craft stores in the country. I guess that's what they're going to do - add even more crafts and plan to still carry dress making fabrics. Can't remember what else she said they will still carry.

Reply to
Donna Aten

Where did you find that hit list, Kathyl? I missed it somehow!

Reply to
Sandy

I was speaking figuratively. From the notice that was posted and the store closing signs at the store....no real list that I've seen. Sorry to confuse the issue. You can get the names of a few of them by Googling "hancock store closing".

Reply to
KJ

I can't imagine that. The JAF here does a very large quilt fabric business - larger than the garmet fabrics.

L>I just heard from one of our LQS owners that three different fabric reps

PATCHogue, NY

Reply to
WitchyStitcher

This is sad ....... I have a Hancock's near where I live, and though it is always messy, I still liked to go there to get SM needles or stabilizer or some last minute "something or other" that I needed.

Patti in Seattle

Reply to
Patti S

I can't imagine that either, the quilt section at our local JoAnns always seems to have people in it, even when the rest of the store is quiet.

Anne

Reply to
Anne Rogers

That got me out of the computer chair!!!!! Drove right on up to my one-and-only Hancock's. There is a sign on the front door in all caps that says "This store is not closing." Heaved a sigh of relief and went in and bought some St. Jude's fabric!

Kay Ahr in NV

Reply to
Kay Ahr

It's good to know there are some staying open!

Reply to
KJ

Mine, too! NOT closing! The store up the road, maybe 30 minutes, IS closing. Go figure. They have a JoAnn's, we don't. I am glad.......I like having them for essentials. I don't usually buy anything but yarn and muslin.....

Laurie G.

Reply to
Laurie G.

I hope mine isn't one that's closing. It's a pretty nice store; I like it better than JoAnn's and it is closer to me (though they're both within 5 miles or so). Their fabric seems a bit nicer than a lot of the fabric at JoAnn's. I don't buy a lot of fabric there, but it's nice to have close by when I need a garment pattern, a few notions, some interfacing, or some such thing.

Julia > Sad news.

Reply to
Julia in MN

I used to have a Honcocks in the city. Then, several years ago they closed it. No reason given to employees. They gave all there business to Joanns & Walmart. This store was one of the 5 highest earners in Wisconsin. They lost a lot of respect in this town. They will never be allowed back. I knew a lot of the people who worked there. It was my haunt. Not a week went by that I wasn't in there. I really missed the store a lot. It really hurts to lose a store like that. I get most of my fabric over the internet now. Occasionally I go to Joann's but I don't like the store. It's messy and has mostly crafts. I only go there if I really need something right now. I really prefer the internet.

Michele

Reply to
M

On Thu, 22 Mar 2007 12:07:21 -0500, Marcella Peek wrote (in article ):

Noooooo! The Hancocks that opened up in our mall a couple of years ago is far superior to TSWLTH across the road. More fabric choices!

Maureen

Reply to
Maureen Wozniak

Ours is bright and clean (after a makeover several years ago), but just try to find an employee willing to cut fabric. It's very odd -- lots of people straightening shelves, but they all claim they can't cut fabric for you. I'm not sure what they think they're selling. Fabric certainly isn't it.

One funny story about a trip to Hancock's several years ago. My nephew, then

7, was crazy about dump trucks and bulldozers. So I was on a quest to find such fabric for a quilt. I was checking every fabric store in the area (an awful job, but *someone* had to do it! LOL), and went in to Hancock's to look. A very earnest young man (no more than 20) tried to help, but we couldn't find a fabric with either on it. He then brought over some green and yellow John Deere fabric and confidently declared my nephew would never know the difference. I looked him in the eye and said "You've never dealt with a 7 year old, have you. When kids that age are crazy about something, they KNOW the difference." (I finally found the fabric and made the quilt. Said nephew's mother confirmed that yes, he would have known the difference, and John Deere was not acceptable. *grin*)
Reply to
Kathy Applebaum

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