Hancock Fabrics closing all 255 stores nationwide

Hancock Fabrics, which announced plans in February to close its Cedar Rapids stores, is shutting down all 255 of its locations and selling off merchandise and fixtures.

The Baldwyn, Miss., retailer filed for Chapter 11 bankruptcy protection from creditors on Feb. 2 as it looked to restructure and become more competitive in the retail industry. At the time of the filing, Hancock Fabrics operated 255 stores in 37 states and announced plans to close 70 underperforming stores, including two in Cedar Rapids.

On March 29, an auction was held for the remaining assets of the company and Great American Group of Los Angeles submitted the high bid of $65 million. U.S. Bankruptcy Court in Delaware approved the sale of the stores to Great American on March 31.

Hancock Fabrics management had hoped to attract a bidder for the company that would keep it operating. When it failed to attract an adequate offer, the company made the decision to close all the remaining stores.

A 'going out of business” sale has been in progress at the Hancock Fabrics stores in Cedar Rapids, 383 Edgewood Road NW and 4750 Tama St. SE. No closing date has been announced for the stores.

In a filing with the U.S. Securities and Exchange Commission, Hancock Fabrics said the liquidation sale of $280 million of merchandise at all the company's stores will end on or before July 31.

Hancock Fabrics carries a range of fabric, sewing and crafts products, including home decor textiles, accessories, needlecraft supplies and sewing machines. The going-out-of-business sale will include select furniture, fixtures and equipment at the stores.

'Our team has worked closely with Hancock Fabrics in a range of capacities over the years,” Scott Carpenter, president of Great American's Retail Solutions division, said in a statement. 'We expect the going-out-of-business sale to last several weeks before all of the merchandise is sold in the remaining locations.”

Great American will determine which of Hancock Fabrics' nearly 4,500 employees will remain to assist with the sale and store closures. If Great American decides not to use any Hancock Fabrics employees, it must give Hancock Fabrics a seven-day notice.

Hancock Fabrics previously filed for Chapter 11 bankruptcy protection in 2007.