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J. Crew is 'preparing to file for bankruptcy' after being forced to close all its stores along with other retailers amid coronavirus crisis
Reuters ^ | April 30, 2020 | Staff

Posted on 05/01/2020 5:02:47 AM PDT by C19fan

J. Crew is reportedly preparing to file for bankruptcy as soon as this weekend after struggling to stay afloat as a result of the coronavirus pandemic, which put added strain on its already fraught books. According to CNBC, the filing could come as early as this weekend. The company, which is privately owned, is seeking $400million in financing to try to keep going in bankruptcy. J. Crew was already struggling financially when the pandemic hit, forcing retailers to close their stores around the world.

(Excerpt) Read more at dailymail.co.uk ...


TOPICS: Business/Economy; Health/Medicine
KEYWORDS: retailers; virus
The first domino.
1 posted on 05/01/2020 5:02:47 AM PDT by C19fan
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To: C19fan

No sir, they weren’t the first, and neither is Chesapeake Engery (CHK). Sears too, others. The domino row is already rolling. Democrats and the media own this.


2 posted on 05/01/2020 5:06:28 AM PDT by MeneMeneTekelUpharsin (Freedom is the freedom to discipline yourself so others don't have to do it for you.)
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To: MeneMeneTekelUpharsin

I’ll be amazed if Macy’s or JC Penney make it.


3 posted on 05/01/2020 5:08:28 AM PDT by mewzilla (Break out the mustard seeds.)
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To: C19fan

The original LBO from a decade ago involved too much debt. It was already in trouble a year ago, at a time when the Federal Reserve rate was near zero.


https://www.cnbc.com/2019/03/28/j-crew-is-turning-to-debt-restructuring-lawyers-again-sources-say.html
[J. Crew has tapped restructuring lawyers for the second time in as many years to explore options for reworking its debt, as the U.S. clothing chain struggles with falling sales and a dwindling cash pile, people familiar with the matter said on Thursday.

The company’s decision to seek help with its debt once again underscores the persistent business challenges J. Crew faces despite recent turnaround and financial restructuring efforts. A shift to pricier apparel turned off some shoppers, and J. Crew faces competition from e-commerce firms such as Amazon that have squeezed an array of traditional retailers.

The preppy fashion retailer in recent weeks enlisted restructuring attorneys at Weil, Gotshal & Manges LLP, the law firm that helped negotiate a previous debt workout for the company and most recently steered department store operator Sears through bankruptcy proceedings, the sources said.

Weil lawyers with capital markets and mergers and acquisitions expertise are also involved in the discussions with J. Crew, one of the sources said.

J. Crew, which was taken private in 2011 by TPG Capital and Leonard Green & Partners in a roughly $3 billion leveraged buyout, is also interviewing restructuring specialists at investment banks, the sources said.]


If you can’t service your debt when the Fed rate is that low, you need to issue new shares, and some debt needs to be converted to stock. In all likelihood the debt holders did not want to take a haircut, and the equity owners refused to be diluted.


4 posted on 05/01/2020 5:10:16 AM PDT by Zhang Fei (My dad had a Delta 88. That was a car. It was like driving your living room.)
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To: MeneMeneTekelUpharsin

Democrats and media are never held accountable, no matter what. Now, Trump, he’s held accountable every day. Why Americans vote for unaccountable a-holes all the time is incomprehensible.


5 posted on 05/01/2020 5:10:29 AM PDT by virgil (The evil that men do lives after them)
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To: C19fan

Winnowing the herd...


6 posted on 05/01/2020 5:13:27 AM PDT by moovova
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To: C19fan
Let’s remember:
• Bezos owns the Washington Post, which is ground zero for anti-Trump fear mongering

• Bezos also owns Amazon, which is profiting mightily by home delivery while destroying brick and mortars and small businesses

1. Stop all USPS subsidy of Amazon
2. Break up Amazon’s monopolies in retail and technology
7 posted on 05/01/2020 5:15:46 AM PDT by IncPen ("Inside of every progressive is a Totalitarian screaming to get out" ~ David Horowitz)
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To: C19fan

I’ve never heard of J Crew.


8 posted on 05/01/2020 5:40:37 AM PDT by rfreedom4u (The root word of vigilante is vigilant!)
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To: C19fan

Thought the gangbangers and drug dealers kept them afloat, ha!


9 posted on 05/01/2020 6:57:06 AM PDT by ronnie raygun
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To: mewzilla
I’ll be amazed if Macy’s or JC Penney make it.

Me too.

10 posted on 05/01/2020 7:14:00 AM PDT by libertylover (Socialism will always look good to those who think they can get something for nothing.)
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