Cache Inc has become the fifth U.S. apparel retailer to file for bankruptcy in three months as the sector struggles with growing competition and lower spending by teen shoppers. Cache is seeking a “stalking horse” bidder for its assets and it has received commitment for debtor-in-possession financing of up to $22 million from Salus Capital Partners LLC, the retailer said on Wednesday.
Cache listed assets of $10 million-$50 million and liabilities of $50 million-$100 million.
The company said in December that it was evaluating strategic alternatives and had received an inquiry regarding a potential sale.
The mall-based retailer, which has 218 outlets, has not reported a profit in the past nine quarters. Cache had about 2,652 employees in 2013.
The 40-year-old company was the first to bring brands such as Armani and Versace to the United States, according to its website.
Cache blamed the depressed brick-and-mortar retail market, the growth of online shopping and rapidly changing consumer tastes for its Chapter 11 filing.
Several teen apparel retailers have been struggling as young shoppers switch to fast-fashion brands such as H&M, Forever 21 and Inditex’s Zara as well as online retailers such as Amazon.com Inc.
Teen apparel retailers Deb Shops and Delia*s Inc filed for bankruptcy in December, while mall-based apparel retailer Body Central Corp shut shop in January.
Wet Seal, which sells apparel and accessories for teen girls and young women, filed for bankruptcy protection last month.