Photo: Courtesy of BCBG Max Azria
BCBG Group is the latest victim of the retail malaise sweeping the fashion industry.
The women’s brand, which launched in 1989 by Max Azria, today announced it has filed for Chapter 11 bankruptcy protection. The outcome could be stand-alone restructuring, a sale or a merger.
In court documents, the company lists assets between $100 million and $500 million and liabilities in the $500 million to $1 billion range.
Reuters reports the retailer’s Canadian affiliate filed separately for voluntary reorganization proceedings under Canada’s Bankruptcy and Insolvency Act.
The label has received a commitment of up to $45 million in debtor-in-possession financing, which will be used for working capital and to continue normal operations during the Chapter 11 process, according to a statement from BCBG.
The company is closing stores in Canada and consolidating its European and Japanese operations. U.S. stores will remain open during what is expected to be a six month reorganization process.
BCBG’s story is similar to other retailers that have shuttered in the last year: shoppers just aren’t frequenting stores like they used to. The brand experienced
a 20 percent drop in brick-and-mortar business, which accounted for 71 percent of its revenue.
Just last month, BCBG announced it would close stores and focus on its ecommerce business, though at the time, it denied a sale was in its future. That followed the layoff of more than 100 employees in September.
The company restructured its debt in 2015, which reportedly amounted
to $475 million in 2013, and received a cash infusion of $135 million from investors. In 2016, Marty Staff was brought in as interim chief executive to help turn the company around.