WESTBURY, N.Y.–Sources told HFN that Fortunoff could file for Chapter 11 protection within the next 10 days.
A deal for the chain to secure new capitalization from a private-equity firm reportedly fell through last week, sources said.
“Fortunoff has been and is continuing to work with its financial advisors to consider the complete range of strategic alternatives for the company,” said a spokeswoman for Fortunoff. “Our stores are fully staffed and open for business as usual, and we remain committed to serving our customers.”
In June 2005, the Fortunoff family sold the controlling stake in the retail chain to Trimaran Capital Partners and K Group.
Fortunoff’s high expense structure, high-debt and a tough economic climate have combined to tax the chain, the sources said.