May 5, 2016
Teen apparel retailer Aéropostale Inc. has filed for Chapter 11 bankruptcy to stem years of losses. The retailer said it would close 154 stores throughout the United States and Canada which either lost money last year, or generated little profit.
The retailer’s strategy is to focus reorganization efforts around “a smaller footprint of more profitable stores,” according to the bankruptcy filing. Store closings are scheduled to begin in the U.S. this weekend, and in Canada during the week of May 9.
Aéropostale will finance operations with a $160 million loan from Crystal Financial LLC, along with operating cash flow. The company has filed motions to pay wages and benefits without interruption, honor gift cards in full, uphold international licensing agreements and pay suppliers.