Family Christian Stores is asking a bankruptcy judge to let creditors decide if they want to approve a Chapter 11 bankruptcy plan that would keep the nation’s largest chain of Christian book and gift stores in business.
The request, filed late last week, comes after a U.S. Bankruptcy Judge John Gregg scuttled an auction in which the Grand Rapids-based chain would have been sold to a group that wants to keep the 266 stores in 36 states open.
Family Christian Stores Acquisition’s bid for $43 million was favored by most creditors because it would have allowed the company to continue operating as a retail and online outlet for their wares.
In the election request, the offer by Family Christian Stores Acquisition was sweetened to offer creditors between $52.4 million and $55.7 million, according to the election request filed by Family Christian’s lawyers.
The election would replace a May auction whose results Gregg rejected after it was challenged by a group of bidders that offered $49.8 million with plans to close the stores, liquidate the company’s assets.
Family Christian Stores, which employs 3,100 full-time and part-time workers, asked for the sale through bankruptcy court in hopes of shedding about $90 million of debt to its creditors.
In his June 19 ruling, Gregg said the auction was tainted because Family Christian CEO Chuck Bengochea was promised a job by the successful bidder, Family Christian Acquisition, which is affiliated with Richard Jackson, the Atlanta businessman who heads the group that bought Family Christian Stores in 2012.
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SOURCE: MLive/Grand Rapids Press