Yellowknife (Jan 12/05) - The Yellowknife Saan Store could be closed as a result of its parent company filing for bankruptcy protection.

On Jan. 6, Saan Acquisition Corp. received a court order granting protection from creditors after having acquired the chain on Dec. 16 from Canadian discount department store retailer Saan Stores Ltd.

Reaction on Monday from shoppers exiting the store was negative.

"That's too bad," said customer Mary Adele Dreneck, adding that a cashier at the store told her the Saan could possibly close over the next month. "It is a good store, especially for families."

Fellow Saan customer Patrice Brideau also thought it was bad news.

"The big stores are killing the smaller stores with clothes for the family," said Brideau.

Local managers were not allowed to speak with the media and efforts to contact national managers before press time were unsuccessful.

A news release issued by the company states the "financial performance of Saan has been impaired by penetration into its markets, including core rural markets, by competitors such as Wal-Mart."

The release goes on to state Saan has accumulated net losses over the last six years totalling $47.7 million.

In order to remain viable, the new owners plan to reduce the number of stores and employees, while refocusing operations where they can be more profitable.

The owners of the building housing the Yellowknife Saan store, Rick Holdings Ltd. heard about the bankruptcy application Friday.

Kim Donais, a spokesperson with Rick Holdings, based in Medicine Hat, Alta., confirmed his company has a lease with Saan, but would not say how long it extends.

"We fully expect the new owners will be contacting us within the next 30 days to let us know what they're planning on doing," he said.

Donais said he thought Saan's Northern stores are likely doing better than its southern outlets.

"Our speculation is that they're not going anywhere," he said referring to the Yellowknife location.