The American fashion retailer has been working during the last couple of weeks to obtain additional financing and negotiate with its creditors to restructure its debt.
Forever21 could face bankruptcy. The American fashion retailer may be at the doors of Chapter 11 to restructure its debt.
The company has been working during the last couple of weeks to obtain additional financing and to restructure its debt. In this sense, Forever21 doesn’t rule out the possibility of filling for Chapter 11, if the agreement to avoid courts doesn’t work, according to Bloomberg.
Filing for bankruptcy will allow the company to close unprofitable stores and recapitalize the business. However, this measure could affect some of its shareholders, like Simon Property Group or Brookfield Property Partners, owners of most of its commercial stores.
The company based in Los Angeles, is in conversations with its creditor from the start of this year to restructure its debt. In April, the company closed its ecommerce platform in China and ended the alliances with Tmall and JD.com