Going out of business sales are expected to begin as early as this weekend.
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According to documents the company filed with the United States Bankruptcy Court for the Southern District of New York, Aeropostale will shutter its stores in Fond du Lac’s Forest Mall and the Wausau Center in Wausau, the Milwaukee Business Journal reports.
Aeropostale said in a statement that it intends to “emerge from the Chapter 11 process within the next six months as a standalone enterprise with a smaller store base”.
The company announced an initial store closure list of 113 USA locations, as well as all 41 stores in Canada.
Aeropostale’s bankruptcy follows the recent Chapter 11 filings of competitors such as Pacific Sun, American Apparel and Wet Seal. But as styles changed and prices plummeted, Aeropostale’s advantage decreased. It recorded a net loss of $22 million, an even steeper loss than was seen in the same quarter previous year.
In 2013, the retailer tried to reconnect with teens by announcing a design collection with social media star Bethany Mota that was focused on apparel and accessories. “When a retailer brings on among the most popular social media presence in the world and is unable to drive the sales they need at a profitable rate, it exemplifies the issue that they’re facing”.
The company expects to glean about $21 million in revenue from the liquidation sales, which will last about six to eight weeks, according to the filing.
Established by R.H. Macy’s & Co in the early 1980s, Aeropostale made its stock market debut in 2002 but the New York Stock Exchange delisted the shares in April.
When Fond du Lac’s Aeropostale closes, Ruggeri said a new tenant could move in unless Aeropostale’s lease is tied to its bankruptcy case.
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In conjunction with the Chapter 11 filings, Aéropostale secured a commitment for $160 million in debtor-in-possession (“DIP”) financing provided by Crystal Financial LLC, which, combined with operating cash flow, will allow Aéropostale to meet its go-forward financial commitments.
