Ascena Retail, the operator of the Ann Taylor, Loft, Lane Bryant, Justice and Lou & Grey chains, has filed for bankruptcy.
The Ascena Retail Group Inc., operator of the Ann Taylor, Loft, Lane Bryant, Justice and Lou & Grey chains, has filed for Chapter 11 bankruptcy, the company disclosed today.
The pre-arranged financial restructuring plan is expected to reduce Ascena’s debt by about $1 billion and provide “increased financial flexibility to enable the company to continue its focus on generating profitable growth and driving value for customers and stakeholders.” The company also said that it will reduce its footprint by closing a significant number of Justice stores and certain Ann Taylor, Loft, Lane Bryant and Lou & Grey stores. “This includes the exit of all stores across brands in Canada, Puerto Rico and Mexico and the closure of all Catherines stores,” the company said. The total number of stores to close depends on negotiations with landlords and bankruptcy court permission. Bankruptcy allows retailers to vacate leases without penalties.
“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. As a result, we took a strategic step forward today to protect the future of the business for all of our stakeholders,” said Carrie Teffner, interim executive chair of Ascena.
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