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TROY, Mich. - Kmart Corp. is seeking an emergency order from a bankruptcy judge so it can pay companies that supply its stores with alcohol, The Associated Press reports. Alcohol drives traffic in the stores, and is therefore an important product to carry, a company spokesman said.
Several liquor suppliers have stopped delivering to Kmart, according to recent court filings cited by The Detroit News in Tuesday's editions. As many as 100 alcohol vendors may stop shipments within days, the filing said.
Other vendors, including Sara Lee Corp., Pepsi bottlers and Frito-Lay Inc. have said Kmart is dragging its feet on their outstanding bills and have asked the court to clarify when their debts will be settled.
The case is scheduled to be heard on Wednesday in Chicago by Chief Bankruptcy Judge Susan Pierson Sonderby.
Kmart already has received court approval to pay other critical vendors, including its egg and milk suppliers and Troy-based Handleman Co., its sole music vendor.
In other news, the Detroit Free Press reported today that Kmart has been a major contributor of unregulated soft money to political parties.
Kmart gave $555,000 to parties and their causes in the two years leading up to the November 2000 election, the newspaper said, citing federal campaign reports collected by the Center for Responsible Politics. In 2000, Kmart reported a $244 million loss.
In 2001, Kmart gave $175,000 to political party committees, including $50,000 to a Republican fund-raiser in Washington attended by President Bush, according to the AP.