Popular teen clothing and accessory store Forever 21 has filed for Chapter 11 bankruptcy. As part of the company’s reorganization, Forever 21 plans to close some U.S. stores. The Company also plans to exit most of its international locations in Asia and Europe but will continue operations in Mexico and Latin America.
The company released a list of 178 stores that could close as part of the company’s re-organization. The local Forever 21, located at the CoolSprings Galleria at 1800 Galleria Blvd, Franklin, is listed as a store that may close. The Chattanooga store is also on the potential closings list. Locally, Forever 21 has locations at the Opry Mills Mall, The Mall at Green Hills and The Avenue in Murfreesboro.
The Company enjoys and benefits from decades-long relationships with its vendors, and dozens have already agreed to support Forever 21’s restructuring efforts. To facilitate its restructuring, Forever 21 has obtained $275 million in financing from its existing lenders with JPMorgan Chase Bank, N.A. as agent, as well as $75 million in new capital from TPG Sixth Street Partners, and certain of its affiliated funds. With this capital, Forever 21 intends to operate in a business as usual manner, honoring all Company policies, including gift cards, returns, exchanges, reimbursement and sale purchases. Forever 21 will use these proceedings to right size its store base and return to basics that allowed the Company to thrive and grow into the fast fashion leader.
Forever 21 published a letter to customers on its website. Here is a portion of that letter. Read it in its entirety here.
“Forever 21, Inc. voluntarily filed for bankruptcy protection under chapter 11 of the U.S. Bankruptcy Code. Essentially this allows Forever 21 to continue to operate its stores as usual, while the Company takes positive steps to reorganize the business so we can return to profitability and refocus on delivering incredible styles and fashion you love for many years to come. This does NOT mean that we are going out of business – on the contrary, filing for bankruptcy protection is a deliberate and decisive step to put us on a successful rack for the future.
Most importantly, our stores are open and it will continue to feel like a normal day – you will not see any changes in our stores, gift cards will continue to be accepted, and our policies, including returns and exchanges, remain the same.
As part of our filing, we have requested approval to close a number of stores across the U.S. The decisions as to which domestic stores will be closing are ongoing, pending the outcome of continued conversations with landlords.”
About Forever 21:
Founded in 1984, Forever 21, Inc., headquartered in Los Angeles, California, is a fast fashion retailer of women’s, men’s and kids clothing and accessories and is known for offering the hottest, most current fashion trends at a great value to consumers. Forever 21 delivers a curated assortment of new merchandise brought in daily. To find a store, or for more information please visit: www.forever21.com