The parent company of Ann Taylor and Loft, Ascena Retail Group, filed for Chapter 11 bankruptcy protection Thursday and said it would close some 1,600 stores.
According to CNBC, “Ascena was once the biggest clothing retailer for women in the country, having amassed a portfolio of well-known brands for various sizes and age groups.”
Ascena also is in the process of shutting down Catherines and is shutting down 600 of its Justice stores.
Justice stores in Tupelo, Biloxi, Hattiesburg, Meridian, Ridgeland and Southaven will be closed.
The company said in a press release that its restructuring agreement is supported by more than 68% of its secured term lenders, and it plans to close a number of stores for good and sell the rights to one of its brands.
The Mahwah, New Jersey-based company said it expects to reduce its debts by about $1 billion in its pre-arranged restructuring, providing Ascena with increased financial flexibility to reach profitability.
“The meaningful progress we have made driving sustainable growth, improving our operating margins and strengthening our financial foundation has been severely disrupted by the COVID-19 pandemic,” interim Executive Chair Carrie Teffner said in a statement.
In total, Ascena has 2,800 stores across the U.S., Canada and Puerto Rico, many of them in shopping malls and outlet centers.
Ascena said Thursday it plans to permanently close a “significant” number of Justice stores, along with certain Ann Taylor, Loft, Lane Bryant and Lou & Grey stores during its restructuring. It added that it will be permanently closing all of its stores, across brands, in Canada, Puerto Rico and Mexico.
The company is shutting down its plus-size brand Catherines entirely and plans to sell those intellectual property assets to a stalking-horse bidder, City Chic Collective Limited. That is still subject to better offers, it said, not disclosing the amount City Chic is looking to pay.
Last year, in a bid to cut costs, Ascena winded down its Dressbarn business, shuttering more than 600 stores. It also sold off its Maurices brand.
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