The liquidation under Chapter 7 of the federal bankruptcy code will cost 37,315 jobs nationally, including 2,000 in the Chicago area.
News the company was going out of business began to leak out Thursday when WBBM-AM reported the company was refusing to accept deliveries from suppliers at its distribution centers around the country. Teary-eyed employees were seen carrying packing boxes and personal belongings from the corporate headquarters building and said they were told the retailer was "winding down" and would close its doors.
A company spokesman said formal announcement was planned later Thursday.
Workers were expected to receive modest severance packages but no extended health benefits after Saturday.
"I had an idea they were going to close up eventually," Gwen Washington, an employee for 13 years, told WFLD-TV.
The folding of Wards was a blow to Chicago, which has lost the corporate headquarters of Ameritech, First Chicago and Amoco to mergers and acquisitions over the last few years.
Wards began as the nation's first general-merchandise, mail-order catalog in 1872 when Aaron Montgomery Ward and his brother-in-law put out a one-sheet price list with ordering instructions. By 1904, the Montgomery Ward Co. was mailing out 3 million catalogs.
The company abandoned the historic catalog, but the department store chain's 1907 Mail Order Building on Chicago Avenue is listed as a national historic landmark.
Wards filed for bankruptcy in July 1997 and reorganized with a $650 million loan from GE Capital, and was attempting a turnaround. Wards redesigned and overhauled stores to upgrade apparel lines and present a new modern image.
GE Capital, Wards' majority shareholder, acquired The Signature Group, the direct-marketing arm of Wards, as part of the bailout.
The department store chain emerged from Chapter 11 in August 1999 after closing more than 100 underperforming stores, including specialty stores Lachmere, Home Image by Lachmere and Electric Avenue.
With 252 stores in 32 states, Wards was attempting the difficult task of targeting a niche market of 30- to 55-year-old women and 26- to 65-year-old men, somewhere between Sears and J.C. Penny and Target and Wal-Mart.
The revamped prototype stores attracted shoppers and outperformed older Wards stores, but Christmas sales companywide were disappointing.
Wards lost $1.16 billion in 1997 on $5.37 billion in sales but cut its losses dramatically in 1998, earning $585 million from continuing operations compared to 1997. Wards had revenues of $3.2 billion in 1999.
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