New York & Co.’s parent company has filed for bankruptcy weeks after first sounding the alarm over financial troubles.
RTW Retailwinds Inc., which filed a voluntary Chapter 11 petition in a Newark, N.J., bankruptcy court Monday, has reopened about 92 percent of its stores, though the fashion chain is looking at closing 378 locations.
“The company expects to close a significant portion, if not all, of its brick-and-mortar stores and, in connection therewith, the company has launched a store closing and liquidation process,” RTW said on Monday. It also said it is exploring strategic alternatives, including the potential sale of its e-commerce business and related intellectual property assets. The online business remains in operation.
Beyond New York & Co., RTW’s portfolio includes plus-size chain Fashion to Figure and Happy x Nature, the boho-chic line helmed by actress Kate Hudson that emphasizes the use of eco-friendly recycled yarns. The fashion company operates a total of 387 retail and outlet locations across 32 states. The New York & Co. nameplate has hosted popup shops showcasing its dress-focused Eva Mendes line.
RTW said it plans to fully repay the $12.7 million remaining outstanding balance under a loan agreement by Aug. 31 with Wells Fargo Bank, N.A.
The combined effects of a challenging retail environment coupled with the impact of the coronavirus pandemic caused “significant financial distress on our business, and we expect it to continue to do so in the future,” said RTW CEO and chief financial officer Sheamus Toal. “As a result, we believe that a restructuring of our liabilities and a potential sale of the business or portions of the business is the best path forward to unlock value.”
RTW was founded in 1918 by Samuel A. Lerner and Harold M. Lane under the name Lerner Shops. Limited Brands, now L Brands, acquired the company in 1985 and changed the nameplate to Lerner New York. One of the other nameplates under the Lerner umbrella was New York & Co., which then became the new corporate name in 1995. The company was acquired by Bear Stearns Merchant Banking in 2002, and it became a public company in 2004. The company changed its corporate name again in 2018 to RTW Retailwinds Inc. Many of its stores still operate under the New York & Co. nameplate. The company in 2017 acquired Fashion to Figure out of bankruptcy.