Ames asks creditors’ aid in stocking store shelves

ROCKY HILL, Conn. — The new head of Ames Department Stores Inc. has appealed to creditors to help the discount retail chain restock its shelves, especially in time for back-to-school sales at the end of summer.

Nearly 400 of the company’s creditors gathered Thursday in New York to discuss Ames’ Chapter 11 bankruptcy filing and how the company plans to dig out of its problems.

Stephen L. Pistner, Ames’ new chief executive officer, had little to say about the decisions that led the 680-store retailer into U.S. Bankruptcy Court last month. But he asked for cooperation.

“I expect no favoritism from you, but I expect your honest effort to get us back in business quickly,” he said.

Ames has sought protection from creditors while it files a plan to reorganize. Thursday’s meeting was called by the U.S. Trustee’s office, an arm of the bankruptcy court, to choose a committee of creditors to participate in the case.

Michael Cook, a bankruptcy attorney representing Ames, said the company owes an estimated $528 million to 33 banks, $355 million to bondholders and an estimated $350 million to suppliers.

Antonio Alvarez, a financial consultant, said the company has $45 million in cash available. Ames also has received court approval to borrow $25 million from Chemical Bank in New York.

Chemical has agreed to lend Ames up to $250 million. A hearing to approve that financing is scheduled for next Tuesday in New York, Alvarez said.

Pistner said Ames intends to use the money to restock its stores. Company President George Granoff said the shelves are bare because many manufacturers stopped shipping merchandise in March when they feared the company could not pay its bills.

Pistner said he and Granoff are studying the chain’s merchandise to determine which items the company will continue to sell. He said they also will decide how many stores to close.

Pistner also said he is evaluating Ames’ managers.

“Very quickly I’ll be changing key members of the team,” he told creditors. “You’ll see quite a few changes and you’ll recognize some of the names. I’ve had literally hundreds of calls from people asking to join up.”