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On the heels of an array of fashion and retail bankruptcy filings that began to unfold over the course of the year in 2016, New York-based designer Bibhu Mohapatra and retailers The Limited, Wet Seal, and Payless all made headlines when they filed for Chapter 11 protection in early 2017. They were swiftly followed by a handful of additional filings by other retailers, signaling that there is no end in sight to the constant string of fashion and other retail companies struggling financially and looking to bankruptcies courts for protection from their creditors.

For the uninitiated, Chapter 11 bankruptcy – one of the most commonly utilized forms of bankruptcy – allows a company to continue operating while it executes a reorganization plan. Chapter 11 can take a number of forms, but in short: A chapter 11 case begins with the filing of a petition with the bankruptcy court by the debtor (the entity that owes the debt – aka the retailers in the cases at hand). This is followed by the debtor proposing and executing a reorganization plan, which may be used to compromise or even eliminate certain classes of debt.

All the while, the debtor usually remains in possession of his assets and continues to operate any business, subject to the oversight of the court and the creditors committee. Typically, a company that has filed for Chapter 11 bankruptcy trying to stay in business, and as indicated below, this complex proceeding can be very effective in solving short term business problems in an otherwise viable company or winding down a company with valuable assets. (Also included below are instances in which brands have entered into administration, an insolvency process in the United Kingdom by which a company is “placed under the control of an insolvency practitioner to enable the insolvency practitioner to achieve objectives laid down by statute.”)

Fashion and Retail-Related Bankruptcies

Here is a look at some of the most recent fashion and retail-related bankruptcy filings …

March 2023 – Scotch & Soda

Scotch & Soda has filed for bankruptcy in Netherlands due to “serious cashflow problems” that started as a result of the COVID-19 pandemic and have continued amid high inflation and a consumer spending squeeze, per Reuters. “Despite record sales, a structural cash flow deficit has led to the company’s failure to absorb the negative effects of [COVID-19] and high inflation,” the Amsterdam-headquartered fashion brand said in a statement, noting that its 32 stores in the Netherlands will remain open “for the foreseeable future.” The Sun Capital-owned company earned record revenues of 342.5 million euros in financial results reported for the 2022 fiscal year,”according to Yahoo Finance, but said that the previous two years of pandemic restrictions “affected its business performance and financial health negatively,” promoting its Netherlands-specific bankruptcy filing.

February 2023 – Tuesday Morning

Off-price retailer Tuesday Morning Corp. filed for bankruptcy protection on Feb. 14, the second time since the onset of the pandemic. Dallas-based Tuesday Morning Corp. filed its Chapter 11 petition in the Northern District of Texas, listing assets and liabilities of $100 million to $500 million, in its bankruptcy petition, per Bloomberg, which reported that the retailer “emerged from its last bankruptcy in January 2021 after closing about 200 stores, cutting its employee headcount and slashing debt.”

In a press release announcing its second bankruptcy, Tuesday Morning revealed that it has obtained $51.5 million of debtor-in-possession financing from Invictus Global Management to support its ongoing operations, subject to the approval of the bankruptcy court.

January 2023 – Forma Brands LLC

Morphe beauty’s owner Forma Brands LLC filed for bankruptcy in Delaware after reaching a deal with lenders, including Jefferies and Cerberus Capital Management. In a statement on January 12, Forma revealed that it has entered into “a definitive asset purchase agreement” with lenders Jefferies Finance LLC (together with Jefferies Finance LLC, funds managed by Cerberus Capital Management, L.P. and FB Intermediate Holdings, LLC) under which “substantially all of FORMA Brands’ assets will be acquired.” Forma also announced that it has “received a commitment for approximately $33 million in debtor-in-possession financing from the Investor Group, which, subject to court approval, will be available to support the business and its operations throughout the court-supervised sale process.” The investor group will gain control of FORMA Brands’ “wholesale operations, online platforms, and international Morphe retail stores.”

“This agreement is a testament to the strength of our brands most meaningful to our consumers,” Forma president Simon Cowell said in the statement. “We will have additional financial resources available to invest in our multi-category portfolio, product launches and innovative brand and marketing strategy as we advance our vision to inspire creativity, promote inclusivity and connect with consumers around the world through beauty.”

Forma’s Chapter 11 filing comes after the company – whose Morphe brand previously surged in popularity thanks to partnerships with some of YouTube’s biggest beauty influencers, banking a reported $400 million dollars in revenue in 2019 – announced on January 6 that it would shutter all its U.S. stores.


December 2022 – M & Co.

M&Co Trading Ltd., a retail chain in the United Kingdom, has gone into administration, citing “higher costs and waning consumer appetite.” As reported by Bloomberg, “The retailer appointed Teneo to oversee the administration, seeking a possible sale of the business while M&Co’s 170 stores and website continue to operate, according to a statement. Around 1,900 staff are at risk of redundancy.”

August 2022 – Secoo

Secoo has filed for bankruptcy for a second time in under a year, with the Chinese e-commerce luxury goods retailer’s corporate entity Beijing Siku Shangmao Co. lodging a bankruptcy petition with the First Intermediate People’s Court of Beijing Municipality on August 12, according to public records database Tianyancha, after withdrawing an earlier petition. In addition to over-investing in live-streaming and a blockchain-empowered authentication service, analysts state that Secoo has also been dragged down by a fall in demand for luxury goods in China, where national retail sales were up just 3.1 percent year-over-year in June.

Founded in 2008 by Chinese entrepreneur Richard Li Rixue, Secoo grew from a resale player to become China’s largest luxury goods retailer, with a 2017 initial public offering on Nasdaq raising $140 million, which notes that in December 2021, the company received a delisting warning from Nasdaq after its closing bid price for 30 consecutive business days fell below $1 per share, the exchange’s minimum bid price requirement. Secoo was recently granted a second grace period, which lasts until December 12, 2022, to comply with the minimum bid price requirement. According to its 2021 annual report, Secoo recorded a 48 percent year-over-year drop in revenue and a net loss of $88.8 million.

June 2022 – Revlon

Revlon filed for Chapter 11 protection in with a New York bankruptcy court on June 15. President and CEO Debra Perelman stated that despite enduring demand for its products, a “challenging capital structure has limited our ability to navigate macro-economic issues in order to meet this demand.” The New York-headquartered cosmetics giant – which owns the marquee Revlon brand, along with Elizabeth Arden, Almay, and licenses for Elizabeth Taylor, Britney Spears, Juicy Couture, and Christina Aguilera, among others – “expects to receive $575 million in debtor-in-possession financing from its existing lender base, which will help to support its day-to-day operations,” per CNBC. Perelman noted that bankruptcy protection will “allow Revlon to offer our consumers the iconic products we have delivered for decades, while providing a clearer path for our future growth.”

May 2022 – Missguided

Missguided has entered into administration, citing the “extremely challenging” retail environment. Teneo Financial Advisory has been appointed as joint administrator along with the British fast fashion brand. According to Reuters, Missguided will continue to operate as usual while they seem a buyer for the business. “The joint administrators will now seek to conclude a sale of the business and assets, for which there continues to be a high level of interest from a number of strategic buyers,” Teneo managing director Gavin Maher said on Monday.

UPDATE (June 1, 2022): British fashion group Frasers has agreed to acquire Missguided, confirming that it will pay 20 million pounds ($25.2 million) for Missguided’s intellectual property.

This is a short excerpt from a data set that is published exclusively for TFL Enterprise subscribers. For access to our up-to-date fashion & retail bankruptcies tracker, inquire today about how to sign up for an Enterprise subscription.