KB Toys said Monday it will save the remains of the chain and be back in the black by the upcoming holiday season, which begins in November.
The company said it expects to emerge from bankruptcy protection before the holiday shopping season. There are no plans to dump any more of the 648 surviving stores, including the five East Valley versions that made it through several waves of mass closings in 2004, said Kenneth Grady, KB Toys executive vice president.
"I can’t say no stores in Arizona will be closed, but our intent is to continue operating the existing stores and grow the company going forward," Grady said.
KB Toys has stores at Fiesta Mall and Superstition Springs Center in Mesa, Chandler Fashion Center, Arizona Mills mall in Tempe, Paradise Valley Mall in Phoenix and eight other Arizona shopping centers.
They are presumably safe, but the company still has the option of renegotiating leases under bankruptcy rules and a few individual locations could shutter if landlord terms are too tough, Grady said.
Pittsfield, Mass.-based KB Toys had scrapped its Scottsdale Fashion Square store in February 2004, just weeks after the company filed for Chapter 11 bankruptcy protection. Eventually KB Toys dumped more than 600 stores nationwide, nearly half its lot.
The slimmed-down toy seller’s proposed reorganization plan includes a $20 million backing plus a $25 million line of credit from Prentice Capital Management. But the company is still shopping for a better deal.
KB Toys has asked the court to allow a mid-July auction of assets, Grady said. The company is looking for a deal similar to the Prentice offering but with more available cash.
It will not accept an offer that involves liquidating the company, he said.