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As part of its filing for Ch. 11 bankruptcy protection, Raleigh, NC-based Stock Building Supply will slash an additional 2,220 jobs and close more locations. According to a court filing, the distributor will reject 210 leases where the company has already ceased or plans to cease operations. That number could grow.
In its fiscal year ended July 31, 2008, Stock recorded a $744 million loss. It had $3.5 billion in sales. The distributor filed for Ch. 11 bankruptcy protection May 6, 2009.
The company reported in its filing that it will retain 5,000 jobs, down from 7,220 who are currently employed.
"Without the restructuring and relief provided by the Plan and the additional investments into the business, Stock likely faces a liquidation, which would result in the closing of additional locations, the loss of additional jobs, and the impairment of additional classes of creditors," James Major, vice president-finance and strategic planning, wrote in the court filing.
As previously reported, Gores Holdings, which has entered into a joint venture with Wolseley plc for the struggling building materials distributor, will be investing $75 million in Stock, and providing a revolving line of credit of up to $125 million. Wolseley began looking for an exit strategy for Stock earlier this year.
In October 2008, Stock reduced its headcount by more than 5,000 positions to the current levels, and had closed more than 90 branches, including exits from 16 markets across the country. This brought total branch closures to more than 150 since October 2006, and headcount reductions to more than 11,000 positions since peaking in June 2006.
Download the court filing explaining Stock's bankruptcy.