Swifty Serve shuts its doors and files for bankruptcy

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Posted 6:30AM on Saturday, October 5, 2002

DURHAM, N.C. - Swifty Serve Corp., the nation's second-largest privately owned convenience store chain, has shuttered its Durham headquarters and filed for bankruptcy. About 420 convenience stores across the Southeast, including 70 in Georgia, locked their doors for good after the announcement by company officials on Friday, leaving some 3,200 employees without work. As part of its Chapter 11 filing in federal bankruptcy court in Greensboro, Swifty Serve on Friday asked a judge to approve a plan to pay employees. Jeff Hamill, a former 7-Eleven executive who in April took the company's reins as president and chief executive, said he plans to sell off the assets of the company, which at one time was a 600-store chain with $850 million in annual revenues. After growing rapidly in the late 1990s, the chain's balance sheet has lately been squeezed by a shrinking profit margin on gas sales and declining cigarette sales. Facing some $125 million in long and short-term debt, Swifty Serve was trying to sell the company and at the same time working with a lender to keep the company going, Hamill said. But late this week it was clear lenders weren't going to provide money for the company's payroll and Hamill said he decided to close down. "I'm not going to have people working when they're not going to be paid, and that affected everyone in the company," he said. "It was tough, but we had to shut it down." It's not the end envisioned by Durham developer Clay Hamner, who started building the Swifty Serve chain in 1997 with Wayne Rogers, the actor who played Trapper John in the television series MASH. From their $5 million purchase of the 62-store Swannee Swifty chain, the businessmen started building the company - then called Swifty Mart - into the Swifty Serve chain. The company took off in 1998 when they raised $54 million in venture capital to buy E-Z Serve, a 488-store chain in Houston. Hamner served as Swifty Serve's chief executive until Hamill joined the company this spring. Hamner and Rogers head up a group of investors that owns 29 percent of Swifty Serve. Three other investment firms own the rest of the company, which operated stores under the names E-Z Serve, Swifty Serve, Swifty Mart, Country Cupboard and Majik Mart. But Hamner said Friday he and Rogers resigned from the company's board three weeks ago so they could try to buy a part of the chain. The men, representing investment groups, have made an offer to buy almost 200 of the stores for $93 million, he said.