Fashion retailer Forever 21 says it plans to close its 44 stores in Canada.
The company announced in a news release that Forever 21 Canada filed for and was granted protection under the Companies’ Creditors Arrangement Act by the Ontario Superior Court of Justice (Commercial List) in Toronto.
PricewaterhouseCoopers Inc. was appointed as monitor in the proceedings to oversee a full liquidation, once approved by the court, and the wind-down process.
“After considering numerous options, we have made the difficult decision to discontinue operations in Canada. While this decision was not easy to make, we believe it is the right one for Forever 21 Canada. We had hoped for a different outcome, but after years of poor performance and challenges set forth by the headwinds facing the retail industry today, our Canadian operations are simply no longer economically viable,” said Bradley Sell, chief financial officer of Forever 21 Canada, in a news release.
Forever 21 Canada has 44 stores in Alberta, British Columbia, Manitoba, Ontario, Quebec and Nova Scotia and employs approximately 2,000 people. Forever 21 Canada stores will remain open during the liquidation process, the company said.
The company also announced that it has voluntarily filed for protection under Chapter 11 of the United States Bankruptcy Code to enable a reorganization of its business.
“The company’s intention is to continue to operate the majority of its U.S. and Latin American locations as usual, providing customers with great service and a curated assortment of merchandise, while exiting the majority of international locations. This restructuring will enable the company to become a stronger, more competitive enterprise, and a more viable company that is better positioned to prosper for years to come,” it said.
Forever 21, headquartered in Los Angeles, was founded in 1984. It’s a fast fashion retailer of women’s, men’s and kids clothing and accessories.
Mario Toneguzzi is a Troy Media business reporter based in Calgary.