The parent company of Hastings Entertainment filed for bankruptcy on Monday.
As a part of the Chapter 11 filing, Hastings is now in the sale process. The company hopes to complete the process within 30 days, according to spokesperson Rachel L. Rosenblatt of FTI Consulting.
“No stores are closing in conjunction with the chapter 11 announcement,” said Rosenblatt. “But as far as after the thirty-day period, it’s too soon to tell.”
Rosenblatt said the company will be in a better position to discuss the future of the stores after that 30-day period is complete.
She added that Hastings stores are continuing to operate as normal and will stay open as they await the completion of the sales process.
This comes after Draw Another Circle, the parent of Hastings, SPImages and MovieStop, filed for Chapter 11 in United States Bankruptcy Court Monday.
In a release, the company said they believe that the Hastings assets will be most valuable to a buyer.
“In the past six months, Hastings has made significant progress in transforming our stores into entertainment destinations with exciting new categories that appeal to every member of the family and also extend to our e-commerce business,” said Jim Litwak, President and Chief Operating Officer of Hastings, in the press release. “We are hopeful that we are on the right path but need an additional cash infusion to complete our remerchandising strategy. An asset sale to a well-capitalized purchaser would give us this financial stability and allow the buyer to pick and choose the assets it wants to acquire, while also disassociating us from the unique challenges facing our sister companies and creating new opportunities to generate long-term value for our creditors, associates, customers, suppliers and ultimately the communities we serve.”
Hastings and SPImages will operate in the ordinary course while they evaluate potential offers. All three businesses expect to maintain associates’ existing wages and benefit programs.
In addition, Bank of America has committed to providing $90 million in new debtor-in-possession financing. Combined with cash from ongoing operations, the company believes this will ensure the businesses are able to meet their financial commitments throughout the process.
Changes to customer programs include:
- Hastings will no longer accept nor honor customer deposits for future movie purchases. Instead, existing deposits may be applied towards additional purchases in the store.
- Game rentals will no longer be available.
- Gift cards will expire on July 13.
- Hastings’ buyback program has been suspended.
Managers at the Rock Springs Hastings are unable to comment on the proceedings at this time.