Arizona Mills owner may be forced to file for Chapter 11 - East Valley Tribune: Business

Arizona Mills owner may be forced to file for Chapter 11

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Posted: Thursday, January 11, 2007 5:26 am | Updated: 7:07 pm, Fri Oct 7, 2011.

The company that owns Arizona Mills mall in Tempe said it may be forced to file for Chapter 11 bankruptcy protection.

Mills Corp., based in Chevy Chase, Md., said in a filing with the Securities and Exchange Commission that it has to find a buyer and may not have enough cash to continue operating beyond March 31.

The company also disclosed details of an internal audit that revealed accounting problems and possible executive misconduct.

Officials with the company did not return phone calls Wednesday.

Denise Hart, marketing director for Arizona Mills at Interstate 10 and Baseline Road, declined to say how the mall would be affected.

She said the mall’s business has continued to improve.

“We’re very successful here,” she said. “Our sales are doing very well. Every single month of 2006 we were up over the prior year and we expect 2007 to be the same.”

The mall, which features numerous outlet stores like Gap Outlet, The Disney Store Outlet and The Kenneth Cole Outlet, is about to celebrate its 10th anniversary.

The center also features Harkins Luxury 24 Cinemas, GameWorks and an IMAX Theater.

Mills Corp.’s rapid growth over the past decade masked problems. Some big projects like the massive $2 billion Meadowlands Xanadu in northern New Jersey struggled.

And the company revealed last year that it had accounting errors dating to 2001 that would force it to restate several years of earnings.

The company gave investors the first look at some of those accounting mistakes Tuesday, saying in a federal filing that there were widespread problems, some of which may be the result of “possible misconduct” by former company employees.

The company is weighed down by loans it took out last year to stay afloat, and said bankruptcy is a possibility if it can’t sell the company as planned and repay the debt.

The disclosures come as Mills works to restate its earnings from 2001 to 2004 and for the first three quarters of 2005.

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