Troy, MI, Jan. 24--Kmart is negotiating 24 hours a day with its creditors over the company's plan of reorganization, but intends to file the plan Friday regardless of whether the parties come to an agreement on every point. Kmart's reorganization plan will detail how the company intends to revitalize itself and become a viable competitor in the discount market.
If Kmart can't come to an agreement with creditors on the plan, it still aims to file it with the federal bankruptcy court in Chicago on or about Friday because it can always file an amended plan once a full agreement is reached.
The company wouldn't describe the sticking points.
Kmart filed for Chapter 11 on January 22 last year, and is looking to exit bankruptcy protection by April 30. The company's executives have said they don't want to stay in Chapter 11 longer than necessary.
Among the items to be included in the reorganization plan are guidelines for the selection of new board members. Kmart also intends to cancel its current stock and reissue new shares to creditors as payment for their bankruptcy claims.
The company already has taken several steps toward restructuring, including store closings, layoffs and naming a new chief executive, Julian Day, who also is Kmart's president and chief operating officer.
Kmart has closed 283 stores and plans to close 326 more, resulting in a combined loss of more than 59,000 employees in roughly a year, once the second round of closings is complete.
