Express files for Chapter 11 bankruptcy, impacted by hybrid workforce

The sales at these locations are scheduled to start on Tuesday. Beyond these closures, Express said it “expects to continue business operations as usual.”

The chain, which incorporates the Bonobos brand, recorded $1.2 billion in liabilities and $1.3 billion in assets.

Also on Monday, Express announced It received a non-binding letter of intent from WHP Group, shopping mall operator Simon Property Group and Brookfield Properties to purchase most of its stores and operations. Express said the bankruptcy filing would “facilitate the sale process.”

The company said it has received a commitment from some existing lenders for $35 million in latest financing, which is subject to court approval. This could be along with the $49 million in money Express received earlier this month from the Internal Revenue Service related to the pandemic-era CARES Act.

In a prepared statement, Express CEO Stewart Glendinning said that WHP has been “a strong partner” with the corporate since 2023 – and that the proposed sale would offer Express with additional financial resources and “better position the company for profitable growth” while increasing value would maximize stakeholders.

According to Express’ website, the corporate currently operates roughly 530 Express Retail and Express Factory Outlet stores within the United States and Puerto Rico, along with roughly 60 Bonobos Guideshop locations, 12 UpWest stores, in addition to online stores for these brands.

The retailer has been struggling for a while as its office and going-out wear brand becomes less relevant because of continued distant work, noted Neil Saunders, managing director of GlobalData.

“As the company struggled to gain traction with consumers, it had been clear for some time that bankruptcy was the inevitable destination for Express,” he said in a note.

Furthermore, he wrote, “the casualization of fashion places Express firmly on the wrong side of trends, and in our view the chain has made too little effort to adapt.”

Express’s sales fell nearly 10% in its most up-to-date quarter in comparison with 2019, at the same time as consumer spending boomed and the apparel category remained strong. In March, Express was delisted from the New York Stock Exchange after its share price fell under a dollar.

Glendinning told investors in a recent conference call that the corporate had made “missteps” and that its assortment was “not balanced across categories, price points and wearing occasions,” in line with the statement Modern retail. In Saunders’ words, the choice was “overpriced, lacked differentiation and seemed very boring,” and shoppers were willing to pass up.

Express faced growing competition from fast-fashion retailers resembling Shein and Temu, in addition to high-end brands. The company is in some ways “the archetypal middle-market mass retailer, where consumers are increasingly willing to either exclude from the portfolio of stores they visit or shop less to save money,” Saunders wrote.

Express is the most recent retailer to file for bankruptcy this yr, joining Joann and 99 Cents Only.