Children’s clothing retailer Gymboree Group Inc. is expected to seek bankruptcy protection this week, with plans to close all 900 of its stores.
The expected bankruptcy comes less than two years after the retailer’s first stint in bankruptcy court, when it closed a portion of its stores and saw lenders take control of the business.
While Gymboree is expected to liquidate, the fate of Janie and Jack stores is still up in the air, one of the people said. If no buyer can be found, the chain could also be liquidated.
Gymboree first filed for bankruptcy protection in June 2017, weighed down by more than $1 billion in debt stemming from a leveraged buyout by Bain Capital Private Equity LP in 2010.
The company was able to slash $900 million in debt from its balance sheet and turned over control to its lenders, including Carriage House Capital Advisors LLC, Brigade Capital Management LP and Oppenheimer Funds Inc.
At the time of its first bankruptcy filing, Gymboree had more than 1,280 stores, of which it immediately closed 375. Those hundreds of surviving stores continued to weigh down the company.
Dozens of retailers have sought bankruptcy protection in recent years, and many of them have liquidated their chains.
However, in 2017, Gymboree was among the handful of retailers—including Payless ShoeSource Inc. and rue21 Inc. —that emerged from bankruptcy protection with hopes of survival.
