By  on October 24, 2007

Pacific Sunwear of California Inc. said Wednesday that it is exploring "strategic alternatives" for its D.e.m.o. stores, and that it will close its One Thousand Steps stores.

The Anaheim, Calif.-based teen chain said it made the decision after a comprehensive review and evaluation of the real estate portfolio and profit performance of D.e.m.o. and One Thousand Steps. Pacific Sunwear said it plans to hire an investment banker to advise on strategic alternatives for the D.e.m.o. stores, and "close the One Thousand Steps stores as soon as is practical."

"We believe the best way to enhance shareholder value at this time is to focus management¹s attention and capital on the core PacSun business," said Sally Frame Kasaks, chief executive officer of Pacific Sunwear, in a statement. "Over the past two years, our D.e.m.o. team has made many efforts to improve this business. However, as is evidenced by our D.e.m.o. division comp-store sales, the urban streetwear business has been very challenging."

For more, see Thursday's issue of WWD.

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