Charlotte Russe Files for Chapter 11 Bankruptcy
Women's apparel retailer Charlotte Russe Holdings on Sunday voluntarily filed for Chapter 11 bankruptcy protection. The private company, which owns 500 mall-based stores and employs more than 2,200 people across the country, intends to use the bankruptcy proceedings to facilitate an orderly wind-down of 94 of its stores, while continuing to pursue a sale of the business and assets. Charlotte Russe hasn't yet decided which 94 stores it will be closing. In a press release that hit the wires today, the company also said it was continuing to pursue a sale of its business and assets after having received a commitment of $50 million in debtor-in-possession financing. During court proceedings, the retailer said it will continue to operate its website and keep open other Charlotte Russe and Peek Kids locations. It has more than 500 shops operating across the U.S. Charlotte Russe added it will provide additional information about closing sales and the addresses of the stores set to close "in the near term."
Total Retail's Take: This bankruptcy filing was really not that big of surprise to retail watchers. Charlotte Russe, like many other mall-based retailers, has been on a downward spiral for a while as more and more malls close down and people chose to purchase clothing online. Charlotte Russe isn't the only retailer facing hardships: Also on Sunday, FULLBEAUTY Brands, a plus-sized apparel retailer based in New York, filed for bankruptcy protection. And these companies join four retailers that have announced bankruptcy filings so far in 2019: Gymboree, Shopko, Innovative Mattress Solutions, and Beauty Brands. Unfortunately, it looks like 2019 will be the year of retailer bankruptcies.