Standard Brands Paint Company Back in Chapter 11 : Bankruptcy: Lack of a bailout brings second filing in four years. Loan will keep firm afloat as it seeks buyers.

After failing to engineer a bailout from its major shareholder, Standard Brands Paint Co. and two of its subsidiaries have filed for Chapter 11 bankruptcy protection for the second time in four years.

The Torrance-based company--whose 50 retail stores and a paint manufacturing operation in California continue to be hit by tough competition and other woes--said Thursday that it plans to keep its doors open while it looks for buyers for some or all of its assets.

Before its 1992 bankruptcy filing, the company operated 135 stores throughout the West.

The subsidiaries are Standard Brands Paint Co. and Major Paint Co.

Joseph Eisenberg, the company’s bankruptcy attorney, said the firm has received a commitment from an outside lender to provide enough money to keep the company afloat during the Chapter 11 reorganization. He said he could not name the lender or the size of the proposed infusion. The firm’s primary lenders are Los Angeles-based Foothill Capital Corp.; Transamerica Occidental Life Insurance Co., acting as agent for a consortium of insurance companies; and Fidelity Capital & Income Fund.

Eisenberg said the bankruptcy papers were filed Wednesday night and that the company’s 700 employees were notified Thursday morning. The company is evaluating each store before determining whether any will be closed.

Eisenberg said the company is entertaining offers from prospective buyers--as is required under bankruptcy law--but is “not particularly interested” in selling any of the assets if another scenario can be worked out.

“The company has a good position in the marketplace,” he said.

The company’s stock, which closed at 68.75 cents Wednesday, did not trade on the New York Stock Exchange on Thursday.

Under Chapter 11 bankruptcy law, companies are given court protection from their creditors in order to reorganize their finances.

In a Securities and Exchange Commission filing earlier this month, Standard Brands said it needed an additional $4 million by the end of the year to pay its debts and meet expenses, or it would face bankruptcy.

Standard Brands had hoped to be rescued by its major shareholder, Corimon, a Venezuelan paint company. Corimon purchased a 77% interest in Standard Brands in May, which has since been reduced to 55% through a stock conversion.

But Corimon, which had already provided Standard Brands with $1 million in cash, has problems of its own, according to Bloomberg Business News.

Earlier this month, Corimon said it might be forced to sell all or part of its holdings in Colorin Industria de Materiales Sinteticos, a troubled Argentine operation.

Corimon “has really had a change of heart by deciding not to put any more money into Standard Brands,” Julie Dykstra, an analyst with Bear, Stearns & Co., told Bloomberg. “It seems evident that they’re divesting all of their international operations.”

But Eisenberg, a bankruptcy specialist with the Los Angeles law firm of Jeffer, Mangels, Butler & Marmaro, said he had “every reason to believe the company remains supportive of [Standard Brands’] efforts.”

Joanne Williams, a retail specialist at Grubb & Ellis Co., said Standard Brands was caught between aggressive warehouse and discount operations such as Home Depot, HomeBase and Orchard Supply Hardware, and small, upscale stores.

She predicted the company, which has been hit hard by the sluggish Southern California retail climate, will be able to find buyers for many of its sites, particularly those with high visibility and parking. The Santa Monica store, for example, is on Lincoln Boulevard near Santa Monica Boulevard.

“They should be very salable,” Williams said.

She said several discounters who have been priced out of the Los Angeles real estate market are looking for less-costly locations in smaller communities.

Just two weeks ago, Corimon replaced Standard Brands Chief Executive Arthur Broslat with Corimon executive Gilbert Minionis. The company said Broslat, who also resigned his post as president of Corimon, was leaving the company to pursue personal interests. Minionis is the fourth CEO of Standard Brands since 1993.

Following the management shuffle, the company vowed to more aggressively pursue the fast-growing Latino market.

During the first three quarters of 1995, Standard Brands lost $14.2 million on sales of $68.9 million. The company lost $11.9 million on sales of $78.3 million during the same period the previous year.

As of Oct. 29, the company had assets of $41.3 million and liabilities of $33.6 million.