Discount footwear retailer, Payless ShoeSource said Tuesday that it has filed for bankruptcy and will immediately close 400 stores in the US and Puerto Rico.
The closures could impact more than 2,000 employees.
In a statement, Payless called the 400 location its closing as “underperforming.” Payless said announced which 400 locations are closing late Tuesday evening on this website.
“This is a difficult, but necessary, decision driven by the continued challenges of the retail environment, which will only intensify. We will build a stronger Payless for our customers, vendors and suppliers, associates, business partners and other stakeholders through this process,” CEO, Payless, Paul Jones said.
Closing 400 locations is part of a plan to reorganize US $385 million in debt. The company will take an US $80 million loan in order to help get out of bankruptcy. The company also said it plans on expanding in Latin America.
Payless plans to immediately close 400 stores in the U.S. and Puerto Rico and will also aggressively manage the rest of its real estate portfolio. That will mean closing additional stores and seeking to modify existing lease terms. The retailer currently has 4,400 stores in more than 30 countries.
Payless has been in talks with its lenders for months over a restructuring plan that at one point included closing as many as 1,000 stores , or a quarter of the company’s locations.