A popular Texas retailer is now at high risk of bankruptcy with insiders advising of the company proceeding within a few weeks.
Express, the well-known apparel company, is reportedly preparing to file for potential bankruptcy, according to a recent report from the Wall Street Journal.
This development comes after Express hired the debt restructuring advisory firm M3 and the prominent law firm Kirkland & Ellis.
The publicly traded company is grappling with a whopping $280 million in debt and declining sales figures, which have put immense pressure on its financial stability, sources report.
If Express is unable to negotiate new terms with its lenders, the company may be forced to restructure its debt through a Chapter 11 bankruptcy filing.
This would allow the company to continue operating while it reorganizes its finances and seeks to regain its footing in a highly competitive retail market.
Currently, Express is offering a 40% discount on all of its products, a move that reflects the company’s efforts to stimulate sales and attract customers in the face of mounting financial pressures.
There are 29 Express Stores in Texas and 20 Express Outlet stores in the state.
“A potential bankruptcy filing by Express could have a significant impact on the retail landscape in Texas”, reports Ash Jurberg on Newsbreak.
The loss of such a prominent retail presence could affect employment and consumer options within the state, particularly if the company is forced to close additional locations as part of its restructuring efforts.
The fast-fashion chain has struggled to maintain a strong market position since closing 91 of its stores in 2020.
Founded in 1980, Express initially gained popularity by offering customers stylish, affordable everyday pieces.
However, the company’s recent struggles underscore the challenges faced by traditional retailers in an increasingly competitive and rapidly evolving retail landscape.
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Also Read: This Massive Mall Retailer Is Now Closing In California
Other Economy News Today
A cosmetics company now makes painful store closures, affecting nearly 50% of all locations, while simultaneously cutting jobs.
The Body Shop’s administrators have announced a restructuring plan for the retailer’s UK business.
Seven of the retailer’s 198 UK stores will close immediately, and future closures will leave “more than half” the current count operating.
Additionally, the Joint Administrators plan to cut headquarters staff by approximately 40%, aiming for a future headcount of more than 400 full-time employees.
According to a press release, “Stabilizing and strengthening the central core will also support The Body Shop’s international strategy, with Global Head Franchise Partners and wholesale partners in Asia, Middle East and Europe a cornerstone of future success.”
The UK arm of the The Body Shop has entered administration, the British version of bankruptcy protection, according to Reuters and other media reports, but it will continue to operate online and via its 199 UK brick-and-mortar stores for the time being.
Private equity firm Aurelius Group purchased the retailer from Natura &Co in November 2023 for nearly $258 million.
Now, FRP Advisory has been brought in to manage the restructuring process, per Retail Touch Points.
Originally founded in 1976 by Dame Anita Roddick, The Body Shop was known for its ethically sourced natural ingredients and refillable packaging.
Founder Roddick also was a vocal activist for environmental causes, beginning in 1986 with her support for Greenpeace’s Save the Whales campaign.
In 2006 Roddick sold the company to cosmetics giant L’Oréal, which sold it again to Natura &Co in 2017.
Worldwide, the company operates approximately 3,000 stores in 70 countries.
“The Body Shop has faced an extended period of financial challenges under past owners, coinciding with a difficult trading environment for the wider retail sector,” according to a quote from FRP in the Reuters article.
FRP also noted that “the Joint Administrators will now consider all options to find a way forward for the business and will update creditors and employees in due course.”
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Also Read: Another Popular Restaurant Now Declares An Unexpected Bankruptcy
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