Following the closure of its retail locations due to the pandemic, Tuesday Morning Corp. is reportedly gearing up to file for bankruptcy. The Texas-based company was founded in 1974 and has approximately 700 retail locations throughout the country, The Wall Street Journal reported.
Tuesday Morning is running against a Tuesday deadline to pay back debts from J.P. Morgan Chase Bank and other lenders per securities filings, as cited by the outlet. The discount home goods retailer has enlisted law firm Haynes & Boone LLP and A&G Real Estate Partners, a real estate adviser, to prepare for an intended bankruptcy, the outlet noted, citing unnamed sources.
As it does not have an eCommerce presence, Tuesday Morning depends on in-store sales for its revenue. The retailer, which sells such products as off-price home textiles and housewares, had annual sales of approximately $1 billion in recent years.
In April, however, Tuesday Morning furloughed most of its 9,000+ staffers. The retailer has since cut costs and reopened some locations as states relax limitations on nonessential commerce.
Last week, J.P. Morgan, as well as other lenders, made the retailer retain a financial adviser and liquidation consultant and instituted a deadline of Tuesday (May 26) to pay back overall debts of approximately $42 million. The lenders also reduced the retailer’s credit line from $180 million to $130 million and noted that new swingline loans would not be given.
In March, Tuesday Morning had announced that it “elected to draw down $55 million from its secured revolving credit facility to provide additional liquidity and has approximately $91 million currently outstanding under the revolving credit agreement.” The retailer also noted that it had temporarily shuttered all of its 687 stores.
In separate news, JCPenney announced on May 15 that it would file for Chapter 11 bankruptcy and would shutter a still-to-be-determined number of retail locations, per a company press release at the time.