Changing of the guard: Ames CEO wields ax - Stephen Pistner, CEO of Ames Department Stores Inc., discount store chain

Discount Store News, June 4, 1990

Changing of the Guard: Ames CEO Wields Ax

ROCKY HILL, Conn. - The predictable housecleaning at Ames is under way, with two more top executives on their way out and at least 33 stores slated to close by July.

Former Ames president Gerald Kanter will replace Les Dietzman as executive vice president, merchandising, with Dietzman exiting in August. Kanter was most recently president and ceo of Marshall's, the off-price apparel chain. He was president of Ames from 1983 to 1985, leaving after a series of disputes with former management.

"Gerald Kanter's retailing skills make him an excellent addition to our new management team," said new Ames ceo Stephen Pistner. "His merchandising experience and his familiarity with Ames will serve us well as we restructure Ames for the future."

Peter Thorner, formerly senior vice president and chief financial officer of Wheelabrator Technologies, will replace chief financial officer Duane Wolter, who will also leave in August. According to Pistner, Thorner was hired for "his broad experience, financial management skill and executive ability." He joined Wheelabrator from Rapid American Corp., and before that was an audit partner at the accounting firm Deloitte Haskins & Sells.

In other developments, Ames has sent telegrams to suppliers reporting that the company now has more than adequate funds to pay for new shipments of merchandise. "We're trying to do everything we can in a very difficult situation," an Ames spokesman said. Several vendors had reported that Ames financial representatives refused to take their calls shortly before the April filing for Chapter 11.

Ames was recently permitted $250 million in interim financing by a bankruptcy judge to resume the flow of merchandise into the chain's stores. However, the company has already lost much of the prime spring selling season.

The letter sent to clients said, in part, that the $250 million debtor in possession funding along with $185 million in cash on hand "gives us plenty of money to operate our business. We have the cash to pay you for new shipments of merchandise, and can pay your invoices fully and promptly."

The letter also names vendors that have agreed to resume shipments, including Mattel, Samsung, Polaroid, Lee, Bibb, and Pilgrim.

"This is a time to look ahead," the letter continued. "The Ames name may have been tarnished in the vendor community [but] we have taken steps to change that. Ames buyers are reviewing all lines with an eye toward serving our customers better than ever in the future. But, we need partners to do this."

The letter was cosigned by Stephen Pistner and president/chief operating officer George Granoff.

If vendors have been impatient, terminated employees have been more so. Approximately 20 employees of a Cleona, Pa., Zayre store closed earlier this year picketed a nearby Ames store demanding severance and vacation due them. Carrying signs saying "We Don't Want a Raincheck, We Want a Paycheck," the pickets, led by former store manager Judy Troutman, want some $40,000 in pay due them which has been held up by the Chapter 11 filing.