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Investing.com -- Forever 21’s U.S.-based operator is reportedly planning to close at least 200 more stores as part of an anticipated bankruptcy process, according to Bloomberg, citing insiders. The bankruptcy process is expected to commence as early as next month.
The operator is also seeking a buyer for the remaining stores of the retailer. If no suitable buyer comes forward, the company may have to liquidate its entire chain of approximately 350 stores.
The Forever 21 brand and associated intellectual property are owned by apparel chain operator, Authentic Brands. These assets are licensed to Catalyst Brands, which is currently navigating a Chapter 11 bankruptcy process.
Catalyst Brands was established in January of this year, following the merger of JCPenney and SPARC Group. The company manages SPARC Group’s brands such as Aéropostale, Eddie Bauer, Lucky Brand, and Nautica. The shareholders of Catalyst Brands include Simon Property Group (NYSE:SPG), Brookfield Corporation, Authentic Brands Group, and Shein.
Despite the potential bankruptcy process, Authentic Brands’ ownership of the Forever 21 brand will remain secure. The company has plans to license Forever 21 to other existing retailers and distributors, irrespective of the outcome of Catalyst Brands’ potential sale or liquidation in bankruptcy.
Forever 21, Catalyst Brands, and Authentic Brands have not yet responded to requests for comment.
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