FAO files for Chapter 11

New York, Jan. 13 - FAO, Inc. filed for Chapter 11 protection and said it plans to meet with creditors and file a reorganization plan "very soon."

The filing was made in the U.S. Bankruptcy Court for the District of Delaware in Wilmington.

The King of Prussia, Pa. children's specialty retailer said as part of its restructuring it intends to hire an investment banker to assist in raising equity.

Operations will continue without interruption and FAO said it has agreement with its existing bank lenders to use cash collateral to finance its business activities, subject to court approval.

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