As Claire’s Stores seeks to attract investors and potential buyers, the retailer has gained approval to close 37 of its brick-and-mortar stores, which are primarily located in malls, Retail Dive reported.
The news comes a few months after Claire’s, which is best known for its inexpensive jewelry and ear-piercing services, won court approval to vacate 95 stores. In all, the retailer, which has filed for bankruptcy, has been able to exit 130 leases. Going forward, a court will review a plan by Claire’s to market itself to investors and buyers. However, bondholder Oaktree Capital Management has contended that the marketing materials that promote the company undervalue it. As a result, Oaktree says Claire’s should modify its marketing process.
Despite the bankruptcy proceedings, Claire’s is growing its concession business. Through this arrangement, other retailers sell Claire’s products through stands in their stores in return for a commission. The company expects this business to expand through more than 4,000 brick-and-mortar stores in 2018.
Toys R Us also continues to wind down its U.S. business. According a filing in March, the company’s creditors “have determined that the best way to maximize their recoveries is to liquidate the existing inventory in all … 735 remaining U.S. stores and begin an orderly wind down of the U.S. operations.”
Toys R Us first filed for bankruptcy in September 2017 under the weight of $4.9 billion in debt, a vestige from its $6.6 billion acquisition by Kohlberg Kravis Roberts, Bain Capital Partners and real estate investment trust Vornado Realty Trust a little over a decade ago.
Toys R Us had initially hoped the protections of a bankruptcy filing might give the company the freedom it needed to update, streamline and become more competitive. It even managed to garner a $3.1 billion loan at the time to keep stores open during the holidays — normally its busiest season.
But the holidays came and went, and America’s most iconic toy retailer ended up with coal in its stockings — consumers generally don’t like to shop at a retailer they perceive to be dying. That set the stage for a January 2018 announcement that another 200 stores were destined for the chopping block and more rumors that the bankruptcy would soon become a liquidation.