
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: MONDAY, February 4, 1991                   TAG: 9102040288
SECTION: BUSINESS                    PAGE: A-4   EDITION: EVENING 
SOURCE: Staff report
DATELINE:                                 LENGTH: Short

HILLS FILES CHAPTER 11 PETITION/ STORE CHAIN WILL STAY IN OPERATION

At midmorning today, employees of the Hills Department Store on Roanoke's Brambleton Avenue - and likely at the discount chain's other 213 outlets - gathered to hear that the company has filed for financial reorganization under Chapter 11 of the federal bankruptcy code.

The announcement that an attempt at restructuring debt had failed and that bankruptcy reorganization was being sought also included word that the stores will continue to operate. The petition seeking protection from the company's creditors was filed in U.S. Bankruptcy Court for the Southern District of New York.

"We are not going out of business. Hills is a sound business which continues to be profitable on an operating basis," said John C. Brouillard, Hills president and chief operating officer.

Brouillard's statement also said Hills employees will be paid and will receive regular benefits. Chemical Bank of New York has agreed to provide the Canton, Mass.,-based company $250 million so it can buy merchandise to sell, the president said.

Hills, the fifth largest discount store chain in the country, announced in mid-January that it was holding up $50 million in payments for merchandise and interest payments on its 11 percent convertible debentures.

A month ago, Hills said it was closing 28 stores in several states to cut annual losses of some $10 million. It also said that none of its Virginia stores would be closed.

by CNB