Nine West, Sears & More Mall Staples That Went Bankrupt in 2018

A record number of stores closed in 2017, many as a result of bankruptcies.

Rue 21, Payless, Aerosoles, Gymboree, Charming Charlie and Toys R Us were among the chains to close some or all of their doors. And the prediction for 2018 was for more of the same.

Ultimately, though, the year proved much less tumultuous than expected, thanks to a strong economy and a retail community that made strides toward delivering omnichannel services, better assortments and improved experiences.

For some chains, it was it too late to turn things around, however.

In the end, the list of apparel and footwear firms that filed for bankruptcy in 2018 held few surprises. For Nine West, Claire’s, Bon-Ton and Sears, the Chapter 11 filings were seen as foregone conclusions, as each had been highly leveraged.

“We saw bankruptcies as a direct result of debt [this year]. Nine West had over $1 billion in debt. Sears reported they were drowning in debt,” said IBISWorld lead industry analyst Claire O’Connor, adding that the issues extended beyond the monetary. “While they have the common thread of debt, they filed because they couldn’t compete because either their products weren’t demanded as much or they couldn’t compete with other big-box retailers. And stores that were located in malls were not faring well because of falling foot traffic.”

And for the most part, mall-based brands and retailers dominated the 2018 list, with the footwear sector hit particularly hard. Below, the companies that filed for Chapter 11 protection this year.

The Bon-Ton Stores

The first half of 2018 was a will they or won’t they story for Bon-Ton. First, would the retail chain file for bankruptcy, and second, would it come to an abrupt end in liquidation?

The year began with reports that the department store had entered into forbearance agreements with its lenders, giving it breathing room in which to pay $14 million in interest. Burdened with $900 million and debt laboring under seven years of unprofitability, the company had already called in PJT Partners and AlixPartners for operational and financial advisory services and announced plans to close 40 locations, which it operated under its namesake banner as well as Bergner’s, Carson’s and Herberger’s.

Later in January, the retailer laid out an exhaustive plan designed to turn things around, and then days after, filed for bankruptcy protection. The spring saw conflicting reports both of hope that a buyer would be identified in time to save the company and pessimism that liquidation would be the only outcome. Ultimately, CSC Generation purchased the names, sites and data for $900,000 in August and relaunched the Bon-Ton’s sites in September with plans for brick-and-mortar stores to follow for select formats. While the new owners tinker with the stores’ assortments, competitors like Kohl’s set about aggressively marketing to former Bon-Ton shoppers.

Charlotte Olympia

After a decade in business, Charlotte Olympia filed for bankruptcy in February, reportedly due to “unprecedented brick-and-mortar retail disruption.”

The company is said to have lost $6 million in 2017 with outstanding debt as high as $20 million. The brand, known for its whimsical footwear, shuttered its four retail stores in the U.S. while its wholesale arm remained intact. The brand, which launched in 2008 and sold at places like Nordstrom, Saks Fifth Avenue, Net-a-Porter and Shopbop, reportedly brought in revenues of 16.8 million pounds (roughly $23 million) as of March 2017, and was at the same time reporting losses of 6.4 million pounds ($9 million).

The Walking Company

The Walking Company stepped into and out of bankruptcy in four months in 2018.

The filing, which took place in early March and included its subsidiaries, Big Dog USA and FootSmart, was a so-called Chapter 22, given that the company sought bankruptcy protection once before in 2009. Then, the shoe chain said it was a victim of the Great Recession; this time, it was the retail apocalypse. The Walking Company secured $10 million in equity investment and $50 million in financing to keep the doors of its 208 locations open during the proceedings. The footwear retailer emerged from bankruptcy at the end of June, having secured another $10 million-plus in equity and a financing package from Wells Fargo.

Claire’s Stores

The mall mainstay filed for bankruptcy in March to strengthen its balance sheet. This came after Claire’s retained Lazard investment bank in January to evaluate its capital structure.

The jewelry chain, which operates more than 2,471 locations in 17 countries, not including concession and franchise locations, said at the time its international subsidiaries were not a part of the Chapter 11 filing. Unlike other retailers that had filed before it, owing to declining sales, Claire’s saw “record positive same-store consolidated sales growth of 2.7 percent for the first quarters of 2017” as well as a 18.3 percent growth in adjusted Ebitda, the company said in a statement. The primary issue for the chain has been debt, which had kept it on Moody’s watch list throughout 2017. The company secured $135 million in debtor-in-possession financing, with the hopes of emerging from bankruptcy in September having reduced its debt by $1.9 billion. While it took a little more time than anticipated, the chain met its goal and emerged from bankruptcy in October with $575 million in new capital.

Nine West

The year started as the previous one ended for Nine West. Questions continued to swirl about the health of the footwear firm, which had taken up residence on Moody’s retail watchlist in 2017. And only days into the new year, reports surfaced that the Sycamore Partners-owned company was readying bankruptcy plans.

Struggling under a reported $1.5 billion in debt, the group, which included the Nine West, Kasper and Anne Klein brands filed for Chapter 11 protection in April. At the same time, the company announced Authentic Brands Group was set to acquire its Nine West and Bandolino footwear and handbag businesses. Ultimately, ABG landed the brands for $340 million in June, rounding out its footwear portfolio, which also includes Taryn Rose, Airwalk and Frye. Later in the summer, ABG signed a deal that will see Nine West in Kohl’s stores starting in July 2019.


In December 2017, reports surfaced that one of The Rockport Group’s debt holders took ownership of the company. And the footwear firm was said to be exploring its options, an ominous development that often proceeds worse news.

Crescent Capital Group LP took ownership of The Rockport Group from private equity firm Berkshire Partners LLC and injected new capital into the company with other co-investors, sources told Reuters. Crescent reportedly made the equity investment to protect the money it had loaned Rockport and ensure repayment. In May, the department store staple filed for bankruptcy protection and announced that it had entered into an asset purchase agreement with CB Marathon Opco LLC, an affiliate of Charlesbank Equity Fund IX in which Charlesbank would acquire substantially all of Rockport’s assets. Rockport obtained $20 million in new-money debtor-in-possession financing from its existing noteholders, which combined with the $60 million credit facility it had at the time allowed operations to continue uninterrupted. The deal closed in August, and in October, Rockport acquired Reef footwear from VF Corp.

National Stores

National Stores Inc., which operates the Fallas budget retail chain, filed for bankruptcy protection in August, citing a drag on the business from underperforming stores. The company, which offered apparel for the entire family at price points that topped out well below $20, secured $108 million in debtor-in-possession financing from existing lenders. The plan was to close 74 of its 344 locations, which operate under a variety of banners, including Factory 2-U and Anna’s Linen’s by Fallas, in an attempt to return to profitability. In October, the company announced it would close all locations.


The protracted decline of Sears Holdings resulted in a greatly anticipated bankruptcy filing in October. While a record number of other retailers fell in 2017, Sears remained standing. That’s despite not putting forth any plans for moving the retail group forward with the type of omnichannel, fulfillment and assortment initiatives its competitors have been busily pursuing. Instead, Sears seemed focused on financial maneuvering that ultimately drained value from the real estate and brand portfolio — all while the stores fell into disrepair.

For years, the department store chain, along with Kmart stores, had been propped up by the company’s chairman and former CEO Eddie Lampert. Through his hedge fund, ESL Investments, Lampert loaned the retail group an estimated $2.5 billion over the years, according to The Wall Street Journal. As bankruptcy loomed, questions about how Lampert might benefit if the company were to fold grew louder. And even now, he’s fighting to keep the doors open and retain control. The retailer, which secured $300 million in debtor-in-possession financing when it filed, also announced plans to close another 142 locations. Since then, liquidators have been circling, but Lampert has reportedly made a $4.6 billion bid to keep the business going. Meanwhile, goodwill toward Sears Holdings appears to have ebbed, with mall operators expressing a desire to move on with new tenants that can drive the traffic and vibrance Sears stores apparently cannot.

David’s Bridal

A missed loan payment in October was the telltale sign that the David’s Bridal story might not have a happy ending.

The wedding dress retailer that outfits one in three brides in the U.S., according to the Chicago Tribune, secured a 30-day grace period for a $270 million loan while it negotiated with lenders. All the while, the firm sought to calm nervous brides, ensuring them that their dress orders weren’t in jeopardy. In November, the company announced it had reached an agreement with its term loan and senior noteholders on terms of a restructuring agreement designed to reduce the company’s debt by more than $400 million. Days later, the 60-year-old retailer filed for bankruptcy protection with hopes of emerging in January 2019. At the time, David’s Bridal secured $60 million in financing to continue operations.

Editor’s note: This story was reported by FN sister publication Sourcing Journal. For more, visit Sourcingjournal.com.

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