Claire’s, destination for drilling the ears of your shopping center, deposits bankruptcy with assets and liabilities between $ 1 billion and $ 10 billion

Claire’s Holdings LLC and some of its American subsidiaries and based in the United States-collectively Claire’s Us, the operator of Claire’s and Icing Stores across the United States, made the file of the American bankrupt court in Delaware on Wednesday. This has marked the second time since 2018 and for a similar reason: a high debt burden and the change among adolescents who go online physical stores.

The file of chapter 11 of Claire follows the bankruptcies of other teenage retailers, including Forever 21, who filed in March for bankruptcy protection for the second time and finally closed its American activities as traffic in American shopping centers fades and competition from online retailers like Amazon, TEMU and Shein is intensifying.

Claire’s, based in Hoffman Estates, Illinois and founded in 1974, said that its stores in North America will remain open and will continue to serve customers, while exploring all the strategic alternatives. Claire’s operates more than 2,750 stores in Claire in 17 countries across North America and Europe and 190 frosting stores in North America.

In a legal file, Claire’s said that her assets and liabilities were between $ 1 and $ 10 billion.

“This decision is difficult, but necessary,” said Chris Cramer, CEO of Claire’s, in a press release published on Wednesday. “The increase in competition, tendencies in consumption expenditure and the continuous gap of the retail sale of brick and mortar, in combination with our current debt obligations and our macroeconomic factors, require this action plan for Claire and its stakeholders.”

Like many retailers, Claire’s also had trouble with higher costs linked to President Donald Trump’s pricing plans, analysts said.

Cramer said that the company remains in “active discussions” with potential strategic and financial partners. He noted that the company remains determined to serve its customers and to associate with its suppliers and owners in other regions. Claire’s also intends to continue to pay the wages and benefits of employees, and he will seek approval to use cash guarantees to support his operations.

Neil Saunders, Managing Director of Globaldata, a research firm, noted in a note published on Wednesday, Claire’s bankruptcy deposit is “no real surprise”.

“The chain was overwhelmed by a cocktail of problems, both internal and external, which made it impossible to stay afloat,” he wrote.

Saunders noted that in the internal, Claire had trouble with high debt levels that make her operations unstable and declared that the tightening of the cash had left her other choice than to reorganize thanks to bankruptcy.

He also noted that prices increased higher costs, and he thought that Claire’s was not able to effectively manage this last challenge.

Competition has also become clearer and more intense in recent years, with retailers like the Lovisa jewelry chain offering younger buyers a more sophisticated assortment at low prices. He also cited growing competition with online players like Amazon.

“Reinventing it will be a major challenge in the current environment,” he added.