FRESNO, Calif. -- Gottschalks Inc. has moved a step closer toward going out of business.
The Fresno department store chain -- with stores in Alaska, California, Washington, Oregon, Nevada and Idaho -- designated a consortium of liquidating firms as the "stalking horse" or lead bidder in an upcoming auction, according to papers filed this week in U.S. Bankruptcy Court.
The two-stage setup, typical in big bankruptcy cases, makes it relatively difficult for anyone to outbid the stalking horse. Under bid procedures proposed to the court, the company outbidding the liquidators would have to pay them a breakup fee of up to $995,000.
The auction is set for March 30.
Gottschalks, unable to compete against bigger chains and crushed by the weak economy, filed for Chapter 11 bankruptcy on Jan. 14.
The Sacramento (Calif.) Bee