On Friday, discount home-goods retailer Christmas Tree Shops filed for chapter 11 bankruptcy. The move would close 10 underperforming stores with plans to exit chapter 11 by the end of the summer.
The move follows other major retailers economic woes. David’s Bridal filed for chapter 11 bankruptcy in April and will lay off more than 9,000 employees.The bridal dress retailer has $257 million in debt, according to court documents, CBS News reported.
Bed Bath & Beyond also filed for Chapter 11 bankruptcy protection in late April after efforts to raise equity to keep the business afloat failed.
The slew of bankruptcies is in addition to the shuttering of major retails in blue cities, such as Whole Foods, Walmart, Nordstrom, that are hemorrhaging money because of rampant crime.
The Wall Street Journal reports:
Owners Marc and Pam Salkovitz, who are also creditors of the company, plan to retain an ownership stake in the restructured business, Mr. Salkovitz said in an interview Friday with The Wall Street Journal.
“This is strictly a financial restructuring. Our operations are sound,” said Mr. Salkovitz, the company’s chairman.
Christmas Tree Shops filed for bankruptcy with a $45 million loan, including roughly $20 million in fresh capital, from its lenders to finance it through chapter 11, Mr. Salkovitz said. The loan is subject to bankruptcy court approval.
If approved, the loans provided by Eclipse Business Capital and ReStore Capital will fund business obligations, including paying employees and ordering goods and services during the chapter 11 process, the company said.
The Salkovitzs acquired the chain from Bed Bath & Beyond in 2020. Rising consumer prices crimped budgets for the Christmas Tree Shops’ core customers over the past year, Mr. Salkovitz said.
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