World Footwear


Forever 21 is exploring options

Jul 4, 2019 United States
Forever 21 is exploring options
Fast-fashion chain Forever 21 is reported to be in talks with potential lenders and restructuring advisers as it analyses options for recovering from the less healthy moment
The Los-Angeles-based retail chain is going through a difficult moment, and it is said to be exploring financing option to reinforce its liquidity and ensure founder Do Won Chang keeps controlling the company.

No official confirmation was made, but according to Forbes, Forever 21's two founders are no longer billionaires: each is now worth 800 million Us dollars (net worth of 1.6 billion US dollars), down from a high of 5.9 billion US dollars just four years ago.

In the meantime, Bloomberg has reported that a "small faction of officials at Forever 21 Inc. has asked its biggest landlords if they’d consider taking a stake in the clothing retailer, as the company’s leadership battles internally about how to turn around the struggling store chain". Talks to property giants Simon Property Group Inc. and Brookfield Property Partners LP to consider a range of options (including sale) are told to be on the table. Another group of officials, aligned with co-founder Do Won Chang, has opposed to such deal and this is symptomatic of the divergence felt inside the group at the moment.

Rumours about bankruptcy start to be heard, as the group is allegedly hiring restructuring advisors. Renegotiation of leases and downsize of operations might be on the pipeline.

About Forever 21

A family-owned company which opened its first store in Los Angeles in 1984 as Fashion 21. The business established itself as a destination for younger shoppers looking for trendy clothes at affordable prices. Forever 21 operates more than 800 stores in the US, Europe, Asia and Latin America, with most in the US.

Source: Bloomberg

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