Ann Taylor, Lane Bryant owner files Chapter 11 bankruptcy

Ann Taylor, Lane Bryant owner files Chapter 11 bankruptcy

The firm Ascena Retail Group - whose stores are a major tenant of malls and shopping centers - did not specify how many locations it will close.

Ascena Retail Group, the parent company of Lane Bryant, Ann Taylor and Justice, announced Thursday that it has filed for Chapter 11 bankruptcy protection after its business was "severely disrupted by the COVID-19 pandemic".

Ascena said it plans to "strategically reduce" its footprint with the closing of a significant number of Justice stores and a select number of Ann Taylor, Loft, Lane Bryant and Lou & Grey locations. Crew are among the household retail names that have filed for bankruptcy since the start of the pandemic.

According to their websites, there are now four Ann Taylor, nine Loft and 37 Justice stores in Canada, many of them in Ontario.

Ascena was known for decades as Dress Barn, the clothing chain founded in 1962 by Roslyn S. Jaffe.

The Chapter 11 filing comes a few weeks after the company said it would give top executives as much as $5.5 million in retention pay and performance bonuses.

Manchester United 'In Talks' To Sign Bayern Munich's Kingsley Coman
Bundesliga champions Bayern made the £54.8m acquisition of Leroy Sane from Manchester City on a five-year deal earlier in July. Despite seemingly having been around for ever, Coman is still only 24 years old.

Late past year, Ascena shut down all 650 of its Dressbarn stores, which employed about 6,800 people.

The Ascena bankruptcy is one to watch.

The company said in late May that it ended the fiscal third quarter with outstanding debt of $1.3 billion with interest payments due in the fourth quarter of fiscal 2020 of $20.9 million and its next quarterly loan payment of $22.5 million due in November.

This spring, Ascena furloughed 90% of its workers when it temporarily closed its stores while also canceling merchandising orders where possible to preserve cash. Ann Taylor and LOFT had loyal followings in the past, but Ascena acquired them when young female customers were turning to online retailers and low-priced fast fashion brands such as Zara or H&M, where they could pay $30 for a work dress instead of $100.

While 95% of its stores now remain open, Ascena said all Catherines and a "significant amount" of Justice stores will be closed as a result of the move.

As foot traffic in malls slowed over the past decade and halted altogether during the coronavirus pandemic, Ascena has remained saddled with the extensive real estate and operating costs of maintaining its stores across the country.

Related Articles