A fashion manufacturer now files an unexpected bankruptcy after being unable to secure financing following declining sales.
Renewcell was unable to secure financing following several quarters of declining sales.
The Circulose manufacturer said it was unable “to secure sufficient financing” after initiating a short-term strategic review in November.
Although the Sweden-based firm said it had been negotiating with shareholders and existing lenders, its search for sufficient funding did not result “in a solution which would provide Re:NewCell with the necessary liquidity and capital to ensure its operations going forward,” per the release.
On February 12, Renewcell announced that its Board of Directors was rescheduling the publication of its fiscal 2023 report until February 23 “in order to continue the strategic review.”
That report was once again rescheduled per a February 23 announcement, which stated that the company would instead publish the report on February 29, and that the strategic review was “ongoing with highest priority.”
Michael Berg, chairman of Renewcell’s board of directors, said in a release that despite spending “very substantial time and efforts into trying to secure the necessary liquidity, capital and ownership structure for the company,” the board and its advisors were unable to solve Renewcell’s financial problems.
“I regret to inform that we have been forced to take this decision to file for bankruptcy,” Berg said.
“This is a sad day for the environment, our employees, our shareholders, and our other stakeholders, and it is a testament to the lack of leadership and necessary pace of change in the fashion industry.”
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Also Read: A Massive Retailer Now Closes And Begins Liquidation Sale
Other Economy News Today
A popular clothing store makes an unexpected closure in California after 60 years in business, sources report.
Popular clothing chain The North Face is set to leave the city of its birth nearly 60 years after it first appeared, reports The-Sun.
The outdoor clothing chain emerged in San Francisco, California, in the 1960s but its last store in the city will leave later this month.
The North Face store in Union Square is set to join a mass of other retailers abandoning the area including Macy’s.
A spokesperson for the brand confirmed to SF Gate on Thursday that the store will shutter on March 31st.
“The North Face was born in San Francisco, and we have cherished the time spent here, building roots, and creating lasting memories,” a company representative said in a statement.
Following the closure in three weeks, the North Face will be left with just a handful of stores across the Bay Area.
“Despite the closure, The North Face will continue to operate and thrive in these remaining communities,” the company said.
“We remain dedicated to providing quality gear and fostering exploration for our community members.”
The announcement by Macy’s last month that its flagship store from 1929 would be axed as part of its plans to close 150 stores by 2026, “spelled doom for the downtown area”, says the outlet.
“As well as the iconic department store’s announcement, the former Westfield downtown shopping mall is only 25% full as retailers go elsewhere.”
Retailers Madewell, Adidas, J. Crew, Lucky Brand, Hollister, and Aldo are just some of the stores that have closed or have announced their imminent closures in the mall.
Most retailers in the area cite a lack of patrons and safety concerns for employees as the primary reasons for closing.
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Also Read: A New Wave of Unexpected Layoffs Now Hits Illinois
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