J.Crew emerges from bankruptcy, outlines new strategy
Sep 11, 2020
New York-based apparel and accessories retailer J.Crew Group announced on Thursday that it has emerged from Chapter 11 bankruptcy and is now “well positioned for long-term growth.”
Having initially filed for Chapter 11 in May of this year, the company received approval for its financial restructuring plan from a Virginia federal court at the end of August.
The completion of the restructuring process means that NYC-based Anchorage Capital Group, LLC now owns a majority stake in J.Crew Group, which has equitized more than $1.6 billion of secured indebtedness.
The company is also now capitalized with a $400 million exit term loan due 2027, which has been provided by Anchorage, alongside GSO Capital Partners LP, Davidson Kempner Capital Management LP and other structures.
Furthermore, the process has given J.Crew access to a new $400 million ABL credit facility due 2025, agented by Bank of America, N.A.
Looking to the future, J.Crew Group CEO Jan Singer said that the company’s strategy will be focused on three core pillars: offering a focused selection of products, augmenting the brand experience to improve the retailer’s relationship with customers, and “prioritizing frictionless shopping.”
In parallel, the group’s popular Madewell brand will seek to maintain its strong positioning in the denim segment and create a differentiated shopping experience, all while expanding its product offering in order to appeal to new customers.
“J.Crew and Madewell's ability to pair timeless classics with modern, fresh designs will never go out of style, and we intend to continue the legacies of these two iconic American brands with deeply loyal customers and strong, creative leadership teams,” said Anchorage CEO Kevin Ulrich in a release.
“We see an immense opportunity for growth and expansion at each brand and are confident their existing robust direct-to-consumer and e-commerce platforms will position the company to succeed in today's evolving retail landscape,” he added.
The announcement of J.Crew’s bankruptcy in May was one of a flurry of Chapter 11 filings from big-name retailers pushed to the brink by Covid-19-related store closures, which had a particularly negative impact on companies already struggling with slowing sales or overwhelming debt.
Other retailers filing for Chapter 11 bankruptcy at the time included Neiman Marcus Group, J.C. Penney Co Inc, and Brooks Brothers.
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