The Quad-City region could lose three Younkers department stores if the Iowa-born company goes out of business.
Reuters, citing sources, reported Tuesday that Bon-Ton Stores, with headquarters in Milwaukee and York, Pennsylvania, will go out of business after the only bidders competing at the Monday start of its court-supervised auction were liquidators.
Bon-Ton, founded in 1898 and with 260 stores in 24 states, filed Chapter 11 reorganization in February and had been hoping to sell to U.S. mall owners Namdar Realty Group and Washington Prime Group to secure a bid that would have kept many of its locations open, Reuters reported.
In addition to Younkers, the company operates under these names: Herberger's, Bergner's, Elder Beerman, Boston Store and Carson's.
Bon-Ton operates Younkers stores at NorthPark Mall, Davenport; SouthPark Mall, Moline; and in Muscatine.
A spokeswoman for Macerich, which owns the two Quad-City stores, said in an email that the company could not comment on Younkers' business.
Younkers traces its roots to a general store founded in Keokuk in 1856 by the Younker brothers.
According to the Iowa Workforce Development's website, Younkers has filed a WARN (Worker Adjustment and Retraining Notification) notice with the state indicating plans to layoff a total of 635 workers at seven of its Iowa stores. The stores include Sioux City, West Des Moines, Cedar Rapids, Coralville, Des Moines, Mason City and Dubuque.
Neither the Davenport or Muscatine store are on the WARN list.
By law, employers are required to give 60 days notice of certain plant closings and mass layoffs.
In January, Bon-Ton announced it would close 42 other stores.
Reuters reported Tuesday that money raised from the auction will be used to repay Bon-Ton’s creditors. Once the company selects a winning bidder and the proposed deal is approved by the U.S. Bankruptcy Court in Wilmington, Delaware, the liquidator can begin selling the inventory, store leases, fixtures and intellectual property.
(Jennifer DeWitt contributed to this report.)