Kmart files for bankruptcy

La Crosse Tribune, Jan 23, 2002 by Cahalan, Steve

It's too soon to predict how Kmart Corp.'s bankruptcy filing Tuesday may affect the Fleming Cos. distribution facilities in La Crosse, Fleming spokesman Randy Hatcher said.

"Right now, it's kind of an unknown," he said in an interview from Fleming headquarters in Dallas, Texas.

Also, no information was available Tuesday on whether the bankruptcy filing could affect the Kmart store at 2415 State Road in La Crosse. Store manager Mark Smith referred a reporter to his company's headquarters in Troy, Mich. A telephone recording there said all Kmart stores remain open, and that no information was available about possible individual store closings in the future.

The La Crosse store opened in 1965. City assessor's office records indicate the 88,400-square-foot building is owned by J&W La Crosse, LLC, and that the land and building have a total assessed value of $3 million. A second Kmart store opened in 1982 on Hwy, 16 near Valley View Mall, but closed in 1995. It was the first discount store to open near the mall and had 93 employees before it closed, according to Tribune files.

Kmart Corp.'s troubles escalated Monday when Fleming, its primary food and consumables supplier, cut off most shipments because Kmart had failed to make its regular weekly payment. Fleming became Kmart's exclusive grocery supplier last June 30.

Fleming has about 1,000 employees at its La Crosse facilities, and added more than 70 jobs there last year because of the new Kmart contract, Hatcher said last week.

There have been some seasonal layoffs at Fleming's La Crosse facilities, Hatcher said Tuesday. "But there are not any that are related to the Kmart bankruptcy or the suspension of shipments," he said.

"Yesterday (Monday), there was quite a deal of uncertainty," Hatcher said. "What the (Kmart bankruptcy) filing has done is wipe clean a good amount of that uncertainty. We know now there's a way to go forward and how that will proceed.

We've been working with Kmart on a restart plan. Once we come to an agreement with Kmart on what that is - and they have to go through the courts - we're ready to resume deliveries instantly."

Hatcher had no prediction how soon Fleming might resume shipments to Kmart.