The operator of Ann Taylor and Lane Bryant filed for Chapter 11 bankruptcy protection on Thursday, the latest retailer to do so during the pandemic. Mahwah, New Jersey-based Ascena Retail Group Inc., which operates nearly 3,000 stores mostly at malls, had been dragged down by debt and weak sales for years.
According to a PTI report: As part of its bankruptcy plan, the company said that it would close all of its Catherines stores, a ‘significant number’ of Justice stores and a select number of Ann Taylor, Loft, Lane Bryant and Lou & Grey stores.
The company said it has reached an agreement with its creditors to reduce its debt by US$ 1 billion. It received US$ 150 million in new financing to continue operating during its reorganization.
Ascena joins a growing list of mostly clothing retailers that have filed for Chapter 11 in recent weeks, including Brooks Brothers, Neiman Marcus, J.C. Penney, J.Crew and Stage Stores. These retailers were already struggling with weak sales, but the forced closure of non-essential stores in March to reduce the spread of the coronavirus put them further in peril.
Roughly 40 retailers, including big and small companies, have filed for Chapter 11 bankruptcy so far this year, according to S&P Global Market Intelligence. That exceeds the number of retail bankruptcies for all of last year. About two dozen of them have sought bankruptcy protection since the pandemic started.