Ritz Camera & Image, the country's largest specialty camera and image chain, filed for Chapter 11 bankruptcy reorganization. The Beltsville, MD-based firm operates 265 photo stores in more than 30 states throughout the country.
It plans to use the bankruptcy filing to get out from under leases for money-losing stores, the company said in its bankruptcy filings. While it has not yet identified which stores or how many it will close, the chain leases space from some of the largest retail landlords in the country, including: Brixmore Property Group, CBL & Associates, DDR, Federal Realty Investment Trust, GGP, Macerich Co., Simon Property Group and Westfield.
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RCI traces its origins back to the prior owner of the business, Ritz Camera Centers Inc., which filed for bankruptcy in 2009. RCI acquired that company in a court-approved auction.
According to RCI's chief restructuring officer Marc Weinsweig, founder, principal, and managing director of Weinsweig Advisors, RCI made significant strides since its formation in 2009 to move toward profitability. In fact, it made a profit in the second half of 2011, and merchandise sales were significantly improved in May 2012.
However, even with this recent success, Weinsweig said RCI was restrained by a lack of sufficient liquidity and capital to sustain its operations with its current store count.
"This deficiency proved too much for the company to overcome. Although significant efforts were made to obtain the necessary capital and liquidity to provide for the working capital needs of RCI, those efforts were not sufficiently successful to permit the company to restructure outside of Chapter 11," he said.
RCI's prior twelve-month net sales through April 30, 2012 totaled approximately $254 million.
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