Payless files for bankruptcy, 400 stores to close
Payless ShoeSource has announced that it has filed for bankruptcy and will close 400 stores in the US and Puerto Rico with immediate effect.
The company posted on its site that "On April 4, 2017, Payless’ North American entities, as well as two foreign Hong Kong-based entities involved in logistics (CBL) and supply chain (DAL), filed voluntary Chapter 11 petitions in the U.S. Bankruptcy Court for the Eastern District of Missouri to facilitate the financial and operational restructuring necessary to strengthen its balance sheet and position the Company for long-term success. Payless is also filing for recognition of the U.S. Chapter 11 proceedings under Part IV of the Companies’ Creditors Arrangement Act in the Ontario Superior Court of Justice."
Payless' stores in the Caribbean will not be affected, Megan Spreer, the media spokesperson for Payless, told Loop. ?
Payless has 4,400 stores in 30 countries and employs nearly 22,000 people.
In the Caribbean, the brand has a presence in Trinidad and Tobago, Grenada, Barbados and Jamaica.
The company said it planned to "work to aggressively manage the remaining" stores through additional closures — beyond the initial 400 — or modified lease terms.
Payless was bought in 2012 by private equity firms Golden Gate Capital and Blum Capital partners.
CEO W. Paul Jones cited a challenging retail environment in announcing the bankrupcty proceedings.
"This is a difficult, but necessary, decision driven by the continued challenges of the retail environment, which will only intensify. We will build a stronger Payless for our customers, vendors and suppliers, associates, business partners and other stakeholders through this process. While we have had to make many tough choices, we appreciate the substantial support we have received from our lenders, who share our belief that we have a unique opportunity to enable Payless — the iconic American footwear retailer with one of the best-recognized global brands — to remain the go-to shoe store for customers in America and around the globe.”