TCR_Public/970908.MBX       T R O U B L E D   C O M P A N Y   R E P O R T E R

               September 8, 1997, Vol. 1, No. 11

                        In This Issue

AUTOWORKS: 53 Michigan Stores to Liquidate, Close
CLOTHESTIME: Company Posts Second-Quarter Profit
COUNTY SEAT: Disclosure Statement Approved
EDISON BROTHERS: Company Reports Second Quarter Profit
EDISON BROTHERS: Fall Seen as End of Chapter 11

HOUSE OF FABRICS: Losses Reported for Second Quarter 1997
LEVITZ: Files Chapter 11; To Close Stores in Seven Cities
MARVEL: Fee Auditor Employed
OLD AMERICA STORES: Seeks to Employ Accountant
POCKET COMMUNICATIONS: Prods FCC on Valuation of Claim

SKEENA CELLULOSE: Owner Banks Want Loan on Their Terms
WEITEK: Liquidating Distribution of Common Stock Announced

                              ---------

AUTOWORKS:  53 Michigan Stores to Liquidate, Close
---------------------------------------------------
AutoWorks, which has been in Chapter 11 bankruptcy protection since July
24, will close permanently as soon as all merchandise is sold, according
to the Detroit News. Gordon Brothers Partners Inc., a retail liquidation
firm, purchased all AutoWorks assets and will oversee the liquidation of
inventory from all 53 retail outlets. The clearance is expected to raise
about $10 million for AutoWorks' parent company, Hahn Automotive Warehouse
Inc., an auto parts supplier based in Rochester, NY, which is not in
bankruptcy.


CLOTHESTIME:  Company Posts Second-Quarter Profit
-------------------------------------------------
Clothestime Inc., the 264-store apparel chain based in Anaheim, earned
$140,000 for the second quarter compared with a loss of $4.2 million for
the same period a year ago.

Sales fell 29 percent to $46.3 million for the period ended June 27, 1997.
Company officials did not provide figures for sales at stores open a year
or more -- a key measure of performance.


COUNTY SEAT:  Disclosure Statement Approved
-------------------------------------------
The Bankruptcy Court in the District of Delaware has approved County Seat,
Inc'’s First Amended Disclosure Statement. A hearing on confirmation of
the reorganization plan has been set for October 1, 1997, before Judge
Helen S. Balick in Wilmington.


EDISON BROTHERS:  Company Reports Second Quarter Profit
-------------------------------------------------------
Edison Brothers Stores, Inc., reported net income of $200,000, or 1 cent
per share, for the three months ended Aug. 2, 1997.  This represents an
improvement over a net loss of $25.2 million, or $1.14 per share, in second
quarter 1996.  Second quarter 1997 results included a pension settlement
gain of $15.8 million and special charges of $10.1 million, primarily
restructuring and reorganization expenses.  Excluding these, the company
had a net loss for second quarter 1997 of $5.5 million, an improvement over
the loss of $18.2 million for the same period in 1996.

Same-store sales for August 1997 were $72.6 million, a decrease of 2.8
percent from same-store sales of  $74.7 million in August 1996.

"Edison continues its progress toward consistent sales and profitability as
we look ahead to completing the Chapter 11 process this fall," said Alan
Miller, Edison's chairman and CEO.


EDISON BROTHERS: Fall Seen as End of Chapter 11
------------------------------------------------
Edison Brothers Stores, Inc., reports that it expects to emerge from
Chapter 11 this fall, following the confirmation hearing on its plan of
reorganization scheduled for September 9, 1997. The company hopes to have
resolved $40 million in outstanding tax claims by the Internal Revenue
Service by that time.


HOUSE OF FABRICS: Losses Reported for Second Quarter 1997
---------------------------------------------------------
House of Fabrics, Inc., has announced financial results for the second
fiscal quarter and six months ended July 31, 1997.

For the second quarter, the company reported a net loss of $5.9 million,
versus net income of $69.5 million for the prior year period, which
included a one-time gain of $100.9 million on forgiveness of debt in
connection with the company's emergence from Chapter 11 in August 1996.
Sales for the quarter totaled $50.2 million compared with $54.8 million a
year ago.

"We look forward to the fall season, which represents the first normalized
selling period since the company emerged from bankruptcy," said president
and CEO Donald L. Richey. "Moving ahead, our management team will remain
focused on the core fundamentals of our business, namely, merchandising,
marketing, and store operations."

During the quarter, House of Fabrics negotiated a more favorable credit
agreement with its current lender, giving the company additional seasonal
credit of approximately $5 million, and it retained Los Angeles investment
banking firm F.M. Roberts & Company, Inc. to advise it on matters of
financing and enhancing shareholder value.


LEVITZ: Files Chapter 11; To Close Stores in Seven Cities
---------------------------------------------------------
Levitz Furniture, one of the nation's biggest home furnishing retailers,
filed in Delaware for protection from its creditors under federal
bankruptcy laws and said it would close its stores in seven cities.

The company plans to continue operations while it develops a plan for
financial reorganization. It expects to meet its day-to-day operating
needs, including paying employees.

"Chapter 11 reorganization will enable the company to continue the
turnaround and repositioning efforts begun last year," said chairman and
CEO Michael Bozic. "It also affords us the opportunity to restructure the
heavy debt load which has been consuming our cash flow."

As of May 31, the chain included 68 warehouse showrooms and 61 satellite
stores located in major metropolitan areas in 26 states. In the fiscal year
ending March 31, Levitz generated revenues of $966.9 million.

Levitz said it will close its stores in Atlanta; Cincinnati; Salt Lake
City; Houston; Reno, Nevada; Jacksonville, Florida; and Fort Myers,
Florida, in addition to closing two smaller satellite stores.


MARVEL: Fee Auditor Employed
-----------------------------
Marvel Entertainment Group, Inc., has hired Legalgard of Philadelphia to
efficiently handle its expected numerous applications for payment of fees.


OLD AMERICA STORES:  Seeks to Employ Accountant
------------------------------------------------
Old America Stores, Inc., wants to hire Deloitte & Touche to perform
accounting, auditing, and tax services necessary for the continued conduct
of the business and for services in connection with the Chapter 11 filing.



POCKET COMMUNICATIONS: Prods FCC on Valuation of Claim
-------------------------------------------------------
Pocket Communications, Inc., is seeking to expedite a hearing on
determining the value of the Federal Communications Commission’s secured
claim on wireless licenses held by its subsidiaries.

The FCC is the largest creditor in the bankruptcy proceedings, holding a
note worth approximately $1.3 billion. Pocket intended to file a plan of
reorganization by the end of September and says that it cannot negotiate
with third-party lenders or proceed with the plan until the FCC claim is
valuated.

However, says the company, although the FCC promised to evaluate proposals
for settlement by the September date, the two sides could not agree on a
valuation method at a July 10 meeting. The FCC then canceled an August 22
meeting.

Pocket would like to meet with the FCC before the court on September 22 to
determine how the FCC secured claim will be handled under its plan of
reorganization.


SKEENA CELLULOSE:  Owner Banks Want Loan on Their Terms
--------------------------------------------------------
The provincial government accused the two banks that own Skeena Cellulose
of blackmail after a breakdown in talks aimed at restarting Skeena's
financially plagued Prince Rupert pulp mill and three northern interior
sawmills, according to the Vancouver Sun.

Royal Bank and Toronto Dominion Bank said they have given the government
until September 15 to agree to an $85-million loan on the banks' terms or
they will abandon their plan to restart Skeena Cellulose.

“In this event the company would be unable to file a viable restructuring
plan under the Company Creditors' Arrangement Act and would have no
alternative but to assign itself into bankruptcy,” said a terse statement
from court-appointed monitor David Bowra of Coopers & Lybrand Ltd.

At issue is the banks' demand that the province's $85 million would rank
equally with the core value of the banks' equity, not only with an
$85-million investment by the banks. The banks acquired the company after
former owner Repap Enterprises defaulted on its loans and set the company
adrift.

Deputy premier Dan Miller said if the banks let the company slide into
bankruptcy, the government would review Skeena's forest licenses, which
provide the company with access to 2.3 million cubic meter’s of wood a year.


WEITEK: Liquidating Distribution of Common Stock Announced
-----------------------------------------------------------
Weitek Corporation announced that it will make a  partial liquidating
distribution totaling $6,317,534, or $0.73 for every outstanding share of
its common stock. The distribution will be made to all shareholders of
record as of the close of business on September 15, 1997.

As of this date, the common stock will no longer be transferable on the
company's books and will no longer represent an ownership interest in the
company.  It will only represent the right to receive a pro rata share of
the distribution and subsequent distribution(s), if any.

After the resolution of the one outstanding disputed claim
(for which the company has reserved $691,200) and payment of all
administrative costs, the company's remaining funds, if any, will be
distributed to the shareholders of record.


S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter is a daily newsletter co-published by Bankruptcy
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DC.  Debra Brennan and Rebecca A. Porter, Editors.

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