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Gymboree Children's Clothing Dealer will begin to close its doors after bankruptcy



This is the end of the Gymboree line.

The child wear merchant filed for bankruptcy for a second time in less than two years on Wednesday. This bankruptcy will lead to the end of its leading brand.

Gymboree Group said it plans to close all of its branded Gymboree and Crazy 8 stores, according to the filing. This is about 800 stores.

"The company has worked hard in recent months to explore the possibilities of the Gymboree Group and its brands, and we are disappointed and very disappointed that we must move on with the dropping out of Gymboree and Crazy 8," said Shaz Kahn was elected CEO only in November.

It is expected that the Jenny and Jack stores, a more prestigious brand, will be sold through the same auction next month. Goldman Sachs unit has already agreed to bid

There are 1

47 Jenny and Jack stores. Submission does not specify whether everyone will be open. But all the 534 stores that use the name Gymboree will be closed as well as all 264 Crazy 8 stores. The company has 11,000 part-time and full-time employees.

Bankruptcy does not affect Gymboree Play & Music, a chain of more than 730 centers offering games, music and art classes. This business was sold by the Gymboree Holding Company in 2016

The company filed for bankruptcy for the first time in June 2017 and managed to appear fairly quickly. He made a deal with almost all of his creditors to shed $ 1 billion in debt in this bankruptcy and received an infusion of 115 million dollars in new cash, according to BankruptcyData.com.

He completed the reorganization by September of that year.

But in its latest bankruptcy on Thursday, the company said the "unexpected decline in the brick and mortar retail industry, among other factors, makes it increasingly difficult to support their price and capital structure

Worse than anticipated sales also led to deep discounts on goods that added to their problems.

In December, he announced plans to close down less profitable stores and search for a buyer or other funding to keep Gymboree and Crazy 8 Marks Alive [19659003] The growth of online sales is damaging to Gymboree, just as it is for many traditional brick and mortar traders.

Gymboree's submission has also been lost to traditional retailers, including the Children's Place and The Gap, as well of cheaper stores like TJ Maxx and big competitors

Gymboree started in 1986 with two stores in California, enjoying slow, steady growth, adding 78 stores over the next five years and 275 in the five years then. By the beginning of 2010 it had been up to 950 stores.

The problems that led to the announcement of bankruptcy and closure on Wednesday are not unique to Gymboree. In fact, it is common for retailers trying to use bankruptcy to reorganize to complete a second, last trip to the bankruptcy court in a relatively short time.

This happened recently with RadioShack. those who hope that Sears Holdings, the owner of Sears and Kmart, will be able to survive long-term by cutting off their debts and closing their stores in their current bankruptcy. Sears will allow him to become a smaller, more profitable and more competitive company, but other experts believe the company's stores are weakly positioned to compete for the long-term.

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