Mervyns LLC announced sweeping changes Wednesday as the department store chain attempts to cut its losses.

Mervyns will close a quarter of its stores and lay off 4,800 employees, but only one of seven Oregon locations — a 98,010-square-foot Washington Square anchor in Portland — is on the chopping block.

The Hayward, Calif.-based company said it will close 62 stores in eight states, with the bulk of the cutbacks concentrated in Texas and Michigan. The streamlining also will close stores in Oklahoma, Colorado, Louisiana, California, Oregon and Utah, as well as two distribution centers in Texas and Utah. The closures will be completed by February.

All the affected stores, which generated just 17 percent of Mervyns’ sales, were losing money, Mervyns said.

The Washington Square Mervyns was one of two opened when the company moved into Oregon in 1979. Mervyns has been a Rogue Valley Mall anchor since the regional shopping center opened in 1986. No plans have been announced to close the Rogue Valley Mall store.

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"This was life-and-death for them," said George Whalin, president of Retail Management Consultants in San Marcos, Calif. "They had to make some moves to make this thing profitable."

Mervyns, which started as a San Francisco Bay Area department store chain after World War II, has been steadily losing market share to more nimble competitors for years. Frustrated with the chain’s meager returns, Target Corp. sold Mervyns last year for $1.65 billion to a group of investors that includes Sun Capital Partners Inc., Cerberus Capital Management LP and Lubert- Adler and Klaff Partners LP.

About 1,200 full-time employees and 3,600 part-time workers will be laid off because of the closures, the company said.

Vanessa Castagna, executive chairwoman of Mervyns’ board of directors, said most of the laid-off employees will receive severance packages.

Castagna did not have information on what will happen to the stores after they close.

Closing the unprofitable stores will free up more money for advertising, renovating other stores and scouting for new locations, Castagna said.

After the shake-up, Mervyns will be left with 193 stores in 10 states. The chain still hopes to open several new stores next year, Castagna said.

"This is about defining markets where we can be important," she said. "We’re more competitive now than ever before."

In Texas, Mervyns will close 28 of its 40 stores. The purge also will close 15 stores in Michigan; 10 in Colorado; three in Oklahoma; and three in Louisiana.

Analysts had been expecting some closures, but Whalin was surprised by the breadth of the cutbacks.

"I thought they had more good stores than that," he said. "If they’ve got that many bad stores, and they can clean up that issue, that certainly improves their chances for survival."

Founded in 1949 in San Lorenzo, Calif., Mervyns has long held some of the best retail real estate in California, Whalin said. The company can make itself more competitive with further investment in those properties, he said.

"They’ve got locations that Wal-Mart would die for," Whalin said. "They’re in visible locations in communities where people spend money. There’s no reason this thing can’t be turned around."