Gottschalks creditors may get money owed

For almost a year, creditors of Gottschalks Inc. have wondered what, if anything, they would receive on what they are owed by the bankrupt chain whose store in San Luis Obispo was a key part of the city’s retailing sector.

Many have held out little hope. But as the Fresno-based retailer approaches its final wind-down, court records suggest that businesses to whom millions are owed may recover at least a fraction of their loss.

Gottschalks — which filed for Chapter 11 bankruptcy protection in January 2009 and shuttered the last of its 58 stores in July — estimates in court documents that it owes unsecured creditors between $75 million and $105 million.

“It’s a situation where we’ve written it off,” said Michael Thielen, owner of a Fresno advertising agency owed more than $42,000 by Gottschalks. “We don’t expect to see a penny.”

The wild card is how much money Gottschalks will have available. In a disclosure statement filed with the Bankruptcy Court last month, Gottschalks chief operating officer Gregory Ambro estimated that by the time a bankruptcy plan is approved early this year, “available assets may be in the range of approximately $4 million to $10 million” to repay unsecured debt.

If those numbers prove out, and if the estimates of the debt are accurate, creditors could receive between 3 and 13 cents on the dollar — not much, to be sure, but better than nothing.

The most recent financial statement from Gottschalks shows the company had about $11 million in the bank at the end of November.

The fate of unsecured claims that make up a nearly 200-page list is buried amid the dense legal language of documents filed last month in the U.S. District Bankruptcy Court in Delaware.

There are some secured “priority” creditors, including General Electric Capital Corp., that will be fully repaid what they’re owed. GECC was Gottschalks’ primary lender before bankruptcy, and it provided $125 million in financing for the company to limp along after the bankruptcy filing.

The attorneys, accountants and consultants shepherding the bankruptcy case for Gottschalks are also expected to be paid in full. Through November, those firms have submitted bills for nearly $11.5 million, of which more than $8.8 million has been paid.

Next come the unsecured “impaired” creditors who stand to recover whatever is left after higher-priority claims are paid. They include the vendors of goods and services — such as The Tribune, which is owed more than $100,000 for advertising.

Finally, there are the owners of about 13 million shares of Gottschalks stock whose holdings will be canceled and declared worthless when the plan takes effect.