Express Inc., once known for setting trends in casual office wear, has filed for Chapter 11 bankruptcy protection. The company, which has struggled to keep up with competitors such as Zara and H&M, is now facing significant financial challenges.
Express to Close Over 100 Stores Nationwide
According to AP News, Express, a 1980-founded Columbus, Ohio, retailer, announced on Monday its plans to seek buyers for most of its stores.
The company, parent to the Bonbons and UpWest brands, is also closing several outlets amid its bankruptcy proceedings.
Express revealed it would shut down 95 of its namesake stores and all 10 UpWest locations. The closures will affect outlets across more than 30 states and Washington, D.C., with sales beginning Tuesday at the stores set to close.
Despite significant store closures, Express intends to continue operations as usual in its remaining locations. Additionally, the company has received a non-binding offer from WHP Global, a firm specializing in acquiring and managing consumer brands, which might lead to the sale of most of Express's stores and operations.
This move to file for Chapter 11 bankruptcy protection, as stated by Express, is aimed at facilitating the potential sale and restructuring efforts.
Express, the fashion retailer under Chapter 11 bankruptcy protection, has announced that its potential buyers include major mall operators Simon Property Group and Brookfield Properties.
These companies, alongside consumer brand acquisition firm WHP Global, are part of the consortium exploring the purchase. As of Monday, none of the involved parties had responded to requests for comments.
Also Read: Target's New Age Check Policy Sparks Outrage Among Mall Shoppers
Express CEO Stewart Glendinning expressed confidence in the proposed deal, stating that partnering with WHP since 2023 has strengthened their operations. He believes that the transaction will provide Express with the necessary financial resources to expand and increase profitability, ultimately enhancing value for its stakeholders.
The company currently operates about 530 Express and Express Factory Outlet stores across the United States and Puerto Rico, in addition to approximately 60 Bonobos Guideshop locations. As noted on the Express website, it also maintains online platforms for these brands.
Express Secures New Funding and Updates Leadership
In its bankruptcy filing on March 2 with the U.S. Bankruptcy Court for the District of Delaware, Express reported having nearly $1.2 billion in total debts compared to $1.3 billion in total assets.
Express announced on Monday that it had secured a commitment for $35 million in new financing from some of its current lenders, pending court approval. This financial boost complements the $49 million the retailer received earlier this month from the Internal Revenue Service, a relief effort stemming from the pandemic-era CARES Act.
In addition to its financial updates, Express revealed a change in its executive team. Mark Still has been appointed as the chief financial officer, effective immediately. The company confirmed that they had been serving as an interim CFO since November 2023.
Originally established as a women's fashion retailer, Express expanded into men's wear, offering trendy and affordable workplace attire, such as denim dresses. However, according to Neil Saunders, a managing director at GlobalData, the brand has faced increasing challenges. Competitors like H&M, Old Navy, and athleisure companies like Lululemon have significantly undercut Express's sales.
Saunders highlighted that quality issues have also plagued the brand. Additionally, the shift towards working from home, accelerated by the pandemic, has reduced the demand for office clothing. Saunders remarked, "Everyone has been nibbling at Express from all sides, and Express doesn't have a defensible proposition."
Related Article: PIRCH's Downfall: Sudden Store Closures Precede Emergency Bankruptcy Amid Financial Turmoil
