Feedback Here

fbook  tweeter  linkin YouTube
Global contents also translated in Chinese

Aeropostale files for bankruptcy protection

Struggling teen apparel retailer Aeropostale Inc. filed for bankruptcy protection recently, succumbing to years of losses as shoppers moved on to fast-fashion retailers and online competitors. According to Aeropostale, it plans to finance its operations during its bankruptcy through a $160 million loan from Crystal Financial LLC combined with operating cash flow, as per the court filing. The company expects to emerge out of bankruptcy within six months with a resolution of its disputes with former shareholder Sycamore Partners, which had thrown a lifeline of $150 million to the retailer in 2014.

The mall-based retailer said it would close 113 US stores and all 41 stores in Canada. The difficult market for teen apparel has triggered bankruptcy filings by high-profile retailers such as American Apparel Inc, Quiksilver Inc and Sports Authority Inc in the past year.

Online retailers and fast-fashion retailers such as H&M, Forever 21 and Inditex's Zara have posed a threat to traditional apparel retailers, but American Eagle Outfitters Inc and Abercrombie & Fitch Co have managed to turn around their businesses by controlling inventories and responding faster to changing fashion trends. Aeropostale said in March it was exploring strategic alternatives, including a sale, citing a dispute with a vendor, MGF Sourcing US, an affiliate of Sycamore Partners.