Shop Talk

Retailers, consumers and prices

Check Out Line: Boscov’s sold to private equity

September 19, 2008

boscovs.jpgCheck Out private equity gobbling up department store chain Boscov’s Department Store LLC, one of the latest retailers to get into trouble as customers reduce spending.

Boscov’s, which filed for bankruptcy protection last month, has agreed to sell most of its assets to private equity firm Versa Capital Management Inc. for an undisclosed amount.

Founded in 1911 by Solomon Boscov, who emigrated from Russia to Reading, Pennsylvania with $1.37 in his pocket, the department-store chain grew from its first “Economy Shoe Store and Dry Goods Annex” to a chain of more than 50 stores across the Eastern Seaboard.

But the collapsing housing market, skyrocketing energy and gas prices and higher food costs caused consumers to spend less on discretionary items, and weak credit market conditions led to vendors tightening terms, which proved too much for Boscov’s to weather.

Boscov’s joins more than a dozen retailers to go bankrupt in the past year, including Bombay, Goody’s Family Clothing, Linens n’Things, Mervyn’s, Sharper Image, Shoe Pavilion and Steve & Barry’s.

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