P.M. BRIEFING : Judge OKs Loan to Ailing Ames
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NEW YORK — Ames Department Stores Inc. has received approval from a bankruptcy judge in Manhattan to borrow $250 million in crucial interim financing the troubled retailer needs to restructure, a source close to the company said today.
Ames, whose 1988 acquisition of the Zayre stores triggered its financial woes, filed for Chapter 11 federal bankruptcy protection from creditors April 25 in the Southern District of New York.
Lawyers for Ames had submitted to U.S. Bankruptcy Judge Howard Buschman a request to allow the retailing group, based in Rocky Hill, Conn., to borrow up to $250 million in much-needed fresh funds from Chemical Bank.
“The borrowing of new funds has been approved,” the source said.
Ames, which employs 55,000 people at its 600 stores in 20 states, needed at least $150 million to remain in operation.
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