What’s Next for J.Crew as It Exits Bankruptcy?

J.Crew Group has emerged from bankruptcy.

The specialty retailer announced today that it has completed its financial restructuring process and equitized more than $1.6 billion of secured debt. As it exits from Chapter 11, Anchorage Capital Group LLC has become its majority owner and — along with GSO Capital Partners LP and Davidson Kempner Capital Management LP — has provided the company with a $400 million term loan to support ongoing operations and future initiatives.

What’s more, J.Crew has access to a new $400 million asset-based lending credit facility, which is due 2025.

“We are immensely pleased to have completed this process swiftly, and we thank our customers, associates, vendors, and new owners for the dedication and support they have given us these past several months,” CEO Jan Singer said in a statement.

She added, “Looking forward, our strategy is focused on three core pillars: delivering a focused selection of iconic, timeless products; elevating the brand experience to deepen our relationship with customers; and prioritizing frictionless shopping. As a reinvigorated company, we are committed to serving the changing life and style of today’s multifaceted consumer and to delivering long-term, sustainable results.”

Two weeks ago, J.Crew received approval for its second amended restructuring plan in the the United States Bankruptcy Court for the Eastern District of Virginia. According to the chain, the plan received “widespread support” among its stakeholders.

“We are energized by the opportunity ahead for the Madewell brand and ready to continue our momentum as we enter into a new phase of growth,” Madewell CEO Libby Wadle said today. “We will remain focused on maintaining our place as a leader in denim and innovating to create a differentiated shopping experience. We are also continuing to grow our offering of everyday essentials and are well positioned to lead the casualization trend offering our customers clothes they want to wear now.”

In early May, J.Crew became the first major American retailer to go bankrupt amid the coronavirus pandemic. At the time, it said it would use Chapter 11 to restructure its debt, as well as work to reposition its J.Crew and Madewell labels for the long term. (It currently operates 170 J.Crew stores, 142 Madewell outposts and 170 J.Crew Factory locations.)

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