Dollar store owner Denninghouse seeks creditor shelter; stock marked down 49%: “TORONTO (CP) – Dollar store owner Denninghouse Inc.’s stock lost almost half its value Monday on news that it will close about 80 of its 93 corporate stores and is putting itself up for sale while restructuring under bankruptcy protection from creditors.”
Canadian Press writer Nancy Carr reports that Denninghouse has sought protection from creditors under the federal Companies’ Creditors Arrangement Act, which is Canada’s equivalent of filing for Chapter 11 of the U.S. Bankruptcy Code. For those not familiar with Denninghouse, it owns and operates 93 Buck or Two and Dollar Ou Deux stores across Canada. According to the article, it also has 220 franchise-owned stores, which it hopes to sell — presumably to the franchise owners.
Further, Denninghouse said it plans to close 80 of 93 corporate-owned stores and lay off between 480 and 600 jobs. Ouch! That will definitely hurt the job prospects of people in small and midsize communities, where its dollar stores are typically located. Families will be adversely affected, as well. So, let’s hope Denninghouse provides some sort of severance package to laid off and fired workers. It’s the least it can do, for the privilege of having much of its debt erased from its balance sheet by the bankruptcy court.
We have a Buck or Two store here. Although I’ve never been in it and don’t know if it’s franchise-run or corporate-owned, it seems to have some really neat products and is a good retail staple with stuff at rock bottom $1 and $2 prices.
In short, these types of events are never pretty and never fun. I hope Denninghouse is successful in selling as many Buck or Two and Dollar Ou Deux stores as it can, to minimize store closures and job losses.
Update: Thank you to all affected Denninghouse, Buck Or Two, and Dollar Ou Deux employees and franchise owners for their comments here. The response has remarkable. Having said that, new comments are now disabled.