Two retailers that have been on bankruptcy watch — Lord & Taylor and Tailored Brands — submitted their Chapter 11 filings on August 2.
Store closing sales began at 19 of Lord & Taylor’s 38 locations that day. In May, sources told Reuters that Lord & Taylor was waiting until its stores were allowed to reopen from COVID-19 shutdowns to file for bankruptcy, so that it could bring in the public for those sales. A joint venture of Hilco Merchant Resources and Gordon Brothers is conducting the liquidation.
The remaining Lord & Taylor stores continue to operate as Lord & Taylor owner Le Tote Inc. looks for a buyer, according to The Wall Street Journal. The clothing rental subscription service purchased Lord & Taylor from Hudson’s Bay Company in November 2019. As part of this deal, Hudson’s Bay kept ownership of the real estate and agreed to cover rental costs for the stores for three years.
Le Tote continues to operate its digital subscription service, as well as Lord & Taylor’s online retail business. A message to Lord & Taylor shoppers posted on its web site said, “There are no immediate changes to our e-Commerce site or forms of payment.”
Since June, Tailored Brands has been warning that it might be forced to declare bankruptcy due to the pandemic. Last month, the company announced it would cut 20% of its corporate staff and that it had identified up to 500 retail stores for potential closure.
On Aug. 2, the company revealed that it “has every intention of maximizing” the opportunities offered by Chapter 11 bankruptcy to continue operating stores, supporting all its brands — Men’s Wearhouse, Jos. A. Bank, Moores Clothing for Men and K&G — and maintaining e-Commerce sites. “We executed an agreement with our senior lenders that we expect will allow us to reduce our debt by at least $630 million, gain access to a $500 million debtor-in-possession (DIP) revolving credit facility from our existing lenders and position our brands for success,” the company said.