Chapter 11 Bankruptcy Protection Filed by Express | Lifestyle

Express Inc, a once-popular retailer known for its casual office attire, has filed for Chapter 11 bankruptcy protection as it struggles to compete with fast fashion giants like Zara and H&M. The company, based in Columbus, Ohio, announced on Monday that it is seeking to sell the majority of its stores, including its Bonbons and UpWest brands.

In a move to streamline its operations, Express plans to close 95 of its retail stores and all 10 of its UpWest locations. The closing sales at these outlets, spread across more than 30 states and Washington, DC, are set to begin on Tuesday. Despite these closures, the company stated that it expects to continue business as usual.

Express also revealed that it has received a non-binding letter of intent from a group led by consumer brand acquisition and management firm WHP Global to potentially purchase the majority of its stores and operations. The consortium exploring the deal includes mall operators Simon Property Group and Brookfield Properties. Express CEO Stewart Glendinning expressed optimism about the proposed transaction, stating that it would provide the company with additional financial resources to grow profitably and maximize value for stakeholders.

The company, which operates approximately 530 Express retail and Express Factory Outlet stores in the United States and Puerto Rico, reported nearly US$1.2 billion in total debts and US$1.3 billion in total assets as of March 2 in its Chapter 11 petition filed in US Bankruptcy Court for the District of Delaware.

Express, which started as a women’s fashion retailer before expanding into men’s wear, faced stiff competition from fast fashion brands like H&M and the rise of athleisure brands like Lululemon. Neil Saunders, a managing director with research firm GlobalData, noted that the brand also struggled with quality issues and saw a decline in sales due to the shift towards remote work during the pandemic.

The bankruptcy filing by Express is part of a trend in the retail industry, with a handful of retailers, including fabrics and craft retailer Joann, filing for Chapter 11 so far this year. Analysts predict that the pace of bankruptcy filings in the retail sector will remain steady, as consumers burdened by high debt levels remain cautious about spending.

To support its restructuring efforts, Express has secured a commitment for US$35 million in new financing from existing lenders, subject to court approval. This funding will supplement the US$49 million in cash obtained earlier this month from the Internal Revenue Service under the CARES Act.

In addition to its financial restructuring, Express announced a leadership update, with Mark Still appointed as chief financial officer, effective immediately. Still had been serving as interim CFO since November 2023.

As Express navigates through its Chapter 11 proceedings and potential sale of stores, the company remains focused on adapting to the changing retail landscape and emerging stronger from this challenging period.