Mahwah-Based Ascena, Owner Of Ann Taylor, Files For Bankruptcy

Mahwah NJ

23 July, 2020

3:49 PM

Description

MAHWAH, NJ — The Mahwah-based Ascena Retail Group, which operates brands including Ann Taylor, Lane Bryant, LOFT and Justice, filed for Chapter 11 bankruptcy on Thursday, the company said in a news release. Disrupted by the COVID-19 pandemic, the company said the last few months negatively impacted "meaningful progress" which was being made to get the company back on track financially. In addition to the bankruptcy filing, the company has reached an agreement with creditors to reduce debt by approximately $1 billion, and received $150 million in new financing, they said. Though most of Ascena's brand portfolio will stay intact, the company will close all Catherines stores and sell the brand to City Chic Collective Limited. Other brands will also face store closures, including more than 600 Justice storefronts. Yesterday, Patch reported the Ann Taylor store on East Broad Street in Westfield appeared to have permanently closed. The company closed all Dress Barn locations last year. Read more: Ann Taylor Store On Iconic Westfield Block Is Reportedly Closed "The meaningful progress we have made driving sustainable growth, improving our operating margins and strengthening our financial foundation has been severely disrupted by the COVID-19 pandemic," said Interim Executive Chair Carrie Teffner. "As a result, we took a strategic step forward today to protect the future of the business for all of our stakeholders." Ascena joins a growing list of retailers to file for bankruptcy amid the coronavirus pandemic, including J.C. Penney, J. Crew, Brooks Brothers and Neiman Marcus. In March, the company announced that all store associates were furloughed, and temporary salary reductions were instituted for corporate associates. Tiffner's salary, as well as the salary of CEO Gary Muto, were reduced by 50 percent. However, the Washington Post reports, the Chapter 11 filing comes just weeks after the company said it would give upwards of $5.5 million to top executives in retention pay and bonuses.