Brooks Brothers has gone bankrupt.
The storied American clothier, which has been searching for a buyer, filed for Chapter 11 protection in the United States Bankruptcy Court for the District of Delaware on Wednesday amid the coronavirus pandemic and a shift to casual office attires.
According to the company spokesperson, the purpose of the filing is to obtain additional financing as well as “facilitate a sale process in an efficient manner.” Interested parties have been invited to submit bids, which will be reviewed by the company’s management team, board of directors and financial and legal advisors, then presented to the court for final approval prior to an acquisition.
The bankruptcy comes a month after the brand warned that it could shut down its three factories in the U.S. It operates about 250 stores in North America and planned to shutter just over 50 locations as a result of the COVID-19 health crisis, which forced widespread closures across the retail sector.
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As international, state and local governments ease lockdown restrictions, the chain — headquartered on Madison Avenue in New York City’s Manhattan borough — has proceeded with its reopening plans. It has more than 500 stores around the world, as well as maintains wholesale partnerships with department stores including Nordstrom and Macy’s to sell its collections.
“Over the past year, Brooks Brothers’ board, leadership team, and financial and legal advisors have been evaluating various strategic options to position the company for future success, including a potential sale of the business,” the spokesperson told FN. “During this strategic review, COVID-19 became immensely disruptive and took a toll on our business.”
Founded in 1818 as a family business and owned by Italian billionaire Claudio Del Vecchio, the preppy retailer is recognized for its striped button-down dress shirts, tailored chinos and penny loafers for men. It also sells apparel and footwear for women and children, as well as home essentials like bedding, towels and china sets.
Last year, Brooks Brothers made more than $991 million in revenues — about a fifth of which was online. It secured $75 million in debtor-in-possession financing from brand management firm WHP Global, which is backed by Oaktree Capital and Blackrock. It also received a $20 million loan from investment firm Gordon Brothers.
The brand’s bankruptcy comes at a trying time for retail: Longtime industry leaders JCPenney, Neiman Marcus and J.Crew are only among some of the names that have filed for Chapter 11 protection over the past couple months as the coronavirus outbreak took hold. Brooks Brothers, however, is privately held — unlike many companies that became victims of a private equity leveraged buyout — and is widely regarded as the oldest retail company in the U.S.