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No qualified buyers showed up to participate in a court-supervised sale process for California Pizza Kitchen Inc., the dining chain that filed for bankruptcy in July, WSJ Pro Bankruptcy reported. CPK on Tuesday canceled a court-supervised auction, the company said in a court filing. The sale process was part of a two-prong plan the company has been pursuing, seeking buyers while also negotiating a proposed deal to hand over most of its shares to its top-ranking lenders. The Playa Vista, Calif.-based restaurant chain filed for bankruptcy in July after a months-long search for buyers. The company hired Guggenheim Securities LLC and Kirkland & Ellis LLP last year to find buyers or sell selected assets, as well as to advise on a restructuring, court filings show. Under the restructuring proposal, CPK had planned to cut roughly $400 million in debt to $174 million and exit bankruptcy within three months. The company’s first-lien lenders are entitled to more than 96 percent of the company’s shares under the proposed plan.

Dollar General Corp., the rapidly growing discount chain with over 16,300 stores dotting the rural American landscape, wants to attract more high-income shoppers looking to splurge, the Wall Street Journal reported. The company plans to open a new brand of stores called Popshelf that mostly sells things shoppers don’t need but might want, such as party supplies, home decor or beauty products. Stores will be in the suburbs of larger cities, with two planned for the Nashville, Tenn., area in the next few weeks and 30 by the end of next year. Items will be priced low, mostly under $5, but designed to appeal to women from households that earn as much as $125,000 a year. A record number of stores closed in the first half of the year and 18 retailers filed for chapter 11 protection, putting this year on a pace for new highs for bankruptcies and liquidations. While many pandemic lockdowns and temporary closures have been lifted, brick-and-mortar chains are bracing for much of the spending that moved online to stay there.

A group of JCPenney Co. lenders criticized the way the company plans to parcel out proceeds from its proposed sale to two mall owners and a larger group of lenders that have been steering the retailer’s bankruptcy, <em>WSJ Pro Bankruptcy</em> reported. The dispute complicates Penney’s planned chapter 11 exit and highlights a conflict that predates its pandemic-driven bankruptcy filing in May. The smaller group of lenders, led by Aurelius Capital Management LP, said Penney’s proposed breakup would siphon away hundreds of millions of dollars from all of the company’s lenders and funnel the bulk of the money to a subset among them. The retailer should also be subject to a competitive bidding process, which doesn’t appear to be planned, according to papers filed Monday by the holdout lenders group in the U.S. Bankruptcy Court in Corpus Christi, Texas. Mall owners Simon Property Group Inc. and Brookfield Property Partners LP reached a tentative deal in September to buy Penney for $800 million in cash and debt, including the real estate behind most of the company’s stores, pulling it back from the brink of liquidation. The larger group of Penney lenders agreed to buy the remaining stores in return for forgiving some of Penney’s $5 billion in debt, and lease them to Simon and Brookfield.

Restaurant chain Ruby Tuesday Inc. filed for bankruptcy protection in Delaware as it seeks to stabilize its finances during the pandemic, Bloomberg News reported. The chapter 11 filing comes after the company reached an agreement with secured lenders to support a restructuring plan, it said in a statement today. The filing won’t affect Ruby Tuesday’s restaurants, which will operate as usual while the firm attempts to recover “from the unprecedented impact of COVID-19,” CEO Shawn Lederman said. Liabilities are estimated between $100 million and $500 million, according to the Delaware court filing. Founded in 1972, Ruby Tuesday was bought by NRD Capital Management in 2017. The brand includes more than 500 company-owned and franchised restaurants that employ almost 28,000 staff, according to Ruby Tuesday’s website. The case is Ruby Tuesday Inc., 20-12457, U.S. Bankruptcy Court, District of Delaware.

The owner of the New York Sports Clubs and Lucille Roberts gyms is seeking to speed up a planned sale of its business in bankruptcy court as pandemic pressures mount in the fitness industry, Bloomberg News reported. Town Sports International Holdings Inc. asked for court permission to shorten the timeline to sell itself to a group of investors or other interested parties, court papers show. Given gyms’ cash constraints and liquidity needs during the pandemic, the company is seeking to complete the sale by early next month. Lenders have submitted an initial credit bid for around $80 million. The fitness chain is still marketing its assets and has had “various levels of attendant discussions with nearly 50 potential bidders,” Christopher Wilson, an adviser to the company at Houlihan Lokey Inc., wrote in court papers. The sale must be approved by U.S. Bankruptcy Judge <b>Christopher Sontchi</b> of Delaware. A hearing to approve bidding motions is scheduled for 1 p.m. on Friday, with objections due the same day. Plans call for an Oct. 26 bid deadline and a sale hearing on Nov. 2. 

The coronavirus pandemic accelerated a major shift in the retail industry, according to a Wall Street Journal analysis. Traffic to stores evaporated. Online credit-card transactions soared. E-commerce sales in the second quarter rose by 44.5 percent compared with the same period in 2019, and they now make up 16 percent of all U.S. retail sales, according to the Commerce Department. Consumer spending has picked up since many cities and states began lifting lockdown restrictions and allowing stores to reopen in May, but only some sectors have regained lost ground. Sales, profits and hiring at many grocers and home-improvement retailers are up. Many apparel sellers have slashed staff and closed stores for good. Weekly foot traffic from July until the second week of September is down by an average of 14 percent compared with the same period a year ago, according to mobile-device location data from foot-traffic analytics firm Placer.ai. The pandemic pushed many of the last online-shopping holdouts over the e-commerce hump. Online transactions with credit and debit cards have increased an average of 88 percent each month since the beginning of April, according to weekly transactions collected by financial-data firm Facteus. Home Depot Inc. said online sales doubled in the second quarter, while Dick’s Sporting Goods Inc. said that the retailer’s online sales nearly tripled in the same period.

A judge ordered the bankrupt operator of New York Sports Clubs and Lucille Roberts gyms to stop charging New York customers who submitted cancellation requests or whose primary gyms remain closed, WSJ Pro Bankruptcy reported. The ruling by Judge Debra A. James of the Supreme Court of New York came after New York’s attorney general filed a lawsuit last week accusing Town Sports International Holdings Inc. of charging monthly fees to customers despite coronavirus-related closures. “This order stops New York Sports Clubs and Lucille Roberts dead in their tracks and halts these health clubs from continuing to unlawfully charge many of their members,” Attorney General Letitia James said. James began investigating the gym operator’s billing practices in March when Town Sports didn’t freeze memberships after the state mandated fitness centers to shut down. Town Sports then resumed the charges on Sept. 1. As of last week, the attorney general’s office had received nearly 1,850 complaints about the company. A restraining order issued Friday has blocked the company from charging or attempting to charge any dues, fines or penalties to customers in New York who have submitted cancellation requests since March 16 and to those whose main gyms remain closed.

A unit of British restaurant chain PizzaExpress is seeking chapter 15 bankruptcy protection in the U.S., Bloomberg News reported. PizzaExpress Financing 2 Plc filed for chapter 15 in the Southern District of Texas Bankruptcy Court, according to the filing. The iconic restaurant chain had been struggling even before the pandemic, as changing dining trends reduced demand for its pizzas, and as Hony’s efforts to expand its business outside the U.K. stretched its balance sheet. Covid-19 lockdown measures forced it to close most of its restaurants earlier this year, making a financial and business restructuring more urgent. The company failed to pay 20 million pounds of bond interest that came due July 31. As part of a restructuring proposal that PizzaExpress announced in August, bondholders agreed to take over most of the business, while current owner Hony Capital will keep the Chinese operations.