Forever 21 Goes Bankrupt: How Many Stores Are Closing, Will My Delivery Arrive, Is Website Down?
Retail chain Forever 21 has filed for bankruptcy in an effort to secure the future of the company by focusing efforts on the more profitable core parts of its operations.
The Los Angeles-based company revealed it had filed for voluntary Chapter 11 bankruptcy protection in a statement on Sunday.
In a letter to customers, published on its website, the company confirmed that it is not going out of business.
"On the contrary, filing for bankruptcy protection is a deliberate and decisive step to put us on a successful track for the future," the letter adds.
As part of its "reconstructing strategy," Forever 21 said it will close up to 178 stores in the U.S., as well as most of its locations in Asia and Europe. The company said it will continue operating in Mexico and Latin America.
It is still unknown which of the stores across the U.S. will close
"We have requested approval to close up to 178 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," the company said in an email statement to Reuters.
The company advised customers to check the online store locator for an up-to-date list of stores still open. Forever 21's website will continue to operate and is still offering customers the chance to purchase clothes and other items online.
Forever 21 said that it was able to obtain $350 million in new capital from lenders after filing for bankruptcy, part of their efforts to remain in business with its restructuring.
Using this new capital, Forever 21 announced that it will continue to operate in a "business as usual manner", including honoring all company policies, including gift cards, returns, exchanges, reimbursement and sale purchases.
In a statement announcing the bankruptcy proceedings, Linda Chang, Executive Vice President of Forever 21, said: "This was an important and necessary step to secure the future of our Company, which will enable us to reorganize our business and reposition Forever 21.
"With support from our key landlord and vendor constituents, we are confident we will emerge as a stronger, more competitive enterprise that is better positioned to prosper for years to come, and we remain committed to delivering the fast fashion trends that our customers have come to expect from Forever 21."
Forever 21 was launched in 1984 and currently has 815 stores in 57 countries. It previously announced that it would be closing all 14 stores it has in Japan by the end of October.
