Gymboree, the U.S. retail outfit that sells children’s clothing, is mulling whether to shutter more than half of its 900-store base, Reuters reported Tuesday (Nov. 27), citing people “familiar with the matter.”
The firm emerged from bankruptcy in 2017, and per the newswire has engaged consulting firm Berkley Research Group to explore its options. Berkley is helping Gymboree analyze its leases for stores located in malls.
Among those options for Gymboree – which also owns Janie and Jack and Crazy 8 brands – might be to file for bankruptcy again, according to the sources. In the last bankruptcy, the company cut its debt to the tune of $1 billion and closed a quarter of its shops, with debt post-emergence tied to an $85 million term loan and a $200 million revolving credit line, the newswire reported.
Gymboree was one of a wave of 20 retailers that have filed for bankruptcy since the start of 2017. The list includes Toys R Us and Sears, as the Amazon effect and the move toward eCommerce have roiled the competitive landscape. Headed into the holiday season, said the newswire, sales at brick-and-mortar sales declined as mobile commerce gained ground.
Gymboree’s former lenders — which include distressed debt-oriented hedge funds Searchlight Capital Partners LP, Brigade Capital Management LP and private equity firm Apollo Global Management LLC – are now the company’s lenders.
Gymboree had revamped its brands after emerging from bankruptcy with an emphasis on graphic tees and outerwear.