Million DIP Commitment from Chemical Bank; "Our Business Today is
        Fundamentally Sound and We Will Continue to Implement Our Strategy,"
        says Don Clarke, Chairman

            NORWALK, CONNECTICUT--September 18, 1995--href="chap11.caldor.html">The
        Caldor Corporation
(NYSE: CLD) today announced that as a
result of
        the recent downturn in retail sales and a decline in trade credit
        support, it has filed a voluntary petition to seek
protection under
        Chapter 11 of the Federal Bankruptcy Code.  

            The filing, which was made in the U.S.  Bankruptcy Court for the
        Southern District of New York, will enable the Company to conduct
        business as usual while it implements a plan to reorganize and shore
        up support among its vendors and other creditors.  

            Caldor expects to use all proceeds from its current inventory
        and, in addition, has also obtained a $250 million debtor-in-
        possession financing commitment from Chemical Bank.  Subject to
        court approval, these funds will enable the Company to meet future
        inventory needs and to fulfill obligations associated with operating
        its business, including the prompt payment of new vendor invoices.
        Employees will receive salaries in the normal manner and benefits
        programs will continue.  

            All 166 Caldor discount department stores are open today and
        conducting business as usual.  

            Don Clarke, Chairman, said, "Caldor has a long history of
        successful retailing and our organization has accomplished a great
        deal in the past few years.  Our business today is fundamentally
        sound and we will continue to implement our strategy.  

            "Nevertheless, over the short term we have been confronted with
        a very difficult retail environment, characterized by fierce
        competition, weak sales, and exacerbated by other discount retailer
        bankruptcies.  This has substantially affected business conditions.
        Even though Caldor for the last several years has achieved solid
        financial performance and was in compliance with its bank covenants,
        a portion of the vendor and factor community reacted to this
        difficult environment, and to media reports and rumors, by reducing
        its support.  Although Caldor undertook wide-ranging efforts to
        address these concerns, we were unable to consummate an acceptable
        transaction within the time frame that would allow us to avoid
        jeopardizing the all-important fourth quarter.  Accordingly, we had
        no recourse but to make this most difficult decision and seek
        protection under Chapter 11.  

            "By seeking Chapter 11 protection and arranging for DIP
        financing, we will be able to obtain and pay for a full inventory of
        attractive goods and preserve our strong consumer franchise.  We
        look forward to emerging from Chapter 11 as soon as possible,"  he

            As of July 29, 1995, the Company had consolidated assets
        (unaudited) of approximately $1.2 billion, and consolidated
        liabilities (unaudited) of approximately $883 million.  

            The Caldor Corporation is the fourth largest discount department
        store chain in the U.S.,with annual sales of approximately $2.8
        billion.  It operates 166 stores in ten East Coast states.  With a
        strong consumer franchise in high-density urban/suburban markets,
        Caldor offers a diverse merchandise selection, including both
        softline and hardline products.  

        CONTACT: Media: Wendi Kopsick/Jim Fingeroth,
                 Kekst & Company: (212) 593-2655
                 Investor Relations:  
                 David D. Peterson: (203) 849-2334