Limited Stores LLC, the parent company behind women’s apparel retailer The Limited, filed for Chapter 11 bankruptcy in January of 2017. It did this after receiving advice from corporate financial advisors in late 2016 and liquidating its remaining inventory at steeply discounted prices during the 2016 holiday season. It has closed all of its 250 stores and temporarily suspended online sales.
Like other brick-and-mortar retailers that have shuttered in recent years, The Limited pointed to declining mall traffic, the rise of ecommerce, and changing consumer tastes and values as the reasons behind its decline. In the years since its inception, The Limited had grown and diversified. At one time, it was part of a group of retailer brands that included Lane Bryant and Bath and Body Works. These companies are currently owned by other parent companies.
Asset Purchase Agreement Reached
The Limited’s name will not necessarily die out with its stores’ presence. After filing for bankruptcy with the United States Bankruptcy Court for the District of Delaware, the company entered an asset purchase agreement with Sycamore Partners, a private equity firm.
A Quick Closure Plan Among Other Store Closures
The Limited is only one of many retailers to close their doors this year. Famously, Sears Holdings announced that it will be closing many of its locations in 2017. Retail store closings have been a trend since the beginning of the decade, with brands including Pacific Sunwear, Coldwater Creek, American Apparel, Sports Authority, and Aeropostale filing for bankruptcy in recent years.
What is Voluntary Bankruptcy Relief?
A petition for voluntary bankruptcy relief is quite simple. It means that the indebted party voluntarily sought bankruptcy protection from the court, rather than being forced into an involuntary bankruptcy case by its creditors. Companies that know that they cannot recover from their debt issues without the court’s help often use bankruptcy as a way to get the help they need. Filing a petition for voluntary bankruptcy relief does not automatically mean that the filer will begin the bankruptcy process. Before the process can begin, the court has to examine the petition to determine whether it is compliant with the requirements contained in Form 1 of the Official Forms prescribed by the Judicial Conference of the United States. If so, it may approve the petitioner’s request and allow them to proceed with the bankruptcy process.
Work with an Experienced Itasca Bankruptcy Lawyer
Every bankruptcy case is unique. If you are a small business owner considering filing for bankruptcy, do not assume that your bankruptcy case will follow the same path that another small business or a large corporation’s bankruptcy followed. The unique details of your situation will determine what you need to prepare for during your bankruptcy case. To learn more about filing for bankruptcy, contact our team of experienced bankruptcy lawyers at Newland & Newland, LLP to set up your initial consultation with us. We serve clients in the Arlington Heights, Palatine, Rolling Meadows, Libertyville, Mundelein, Buffalo Grove, Schaumburg, Elk Grove, and Itasca areas.