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RTW Retailwinds files for bankruptcy to close hundreds of stores

A pedestrian wearing a protective mask walks near a temporarily closed New York & Co. store in Silver Spring, Maryland, United States on Friday, June 5, 2020.

Andrew Harrer | Bloomberg | Getty Images

New York & Co.’s parent company, RTW Retailwinds, announced on Monday that it has filed for Chapter 1

1 bankruptcy protection and plans to permanently close most, if not all, of its stores.

The company announced that it has already started selling liquidations. Around 92% of its inpatient locations are open again during the coronavirus pandemic. It said it was considering the potential sale of its e-commerce activities and related intellectual property in bankruptcy proceedings.

RTW Retailwinds is now joining a growing list of retailers who filed for bankruptcy during the Covid 19 crisis as companies were under liquidity pressure due to the closure of their businesses. Other victims include Neiman Marcus, J.Crew, JC Penney, Brooks Brothers and Lucky Brand.

“The combined impact of a challenging retail environment combined with the impact of the coronavirus pandemic has placed a significant financial burden on our business and we expect it to remain so in the future,” said Sheamus Toal, CEO and CFO of RTW Retailwinds statement.

“As a result, we believe that restructuring our liabilities and potentially selling the business or parts of the business is the best way to unlock value.”

According to its website, RTW Retailwinds operates 378 retail and outlet stores in 32 states. In addition to New York & Co., the other brands include Fashion to Figure and Happy x Nature.

Already on June 3, the company warned that there was “serious doubt” about its ability to continue operating and described an application for bankruptcy as “likely”. It also warned at the time when it was possibly in default with a loan agreement with Wells Fargo.

RTW Retailwinds announced on Monday that full repayment of the remaining balance of approximately $ 12.7 million is expected under this special loan agreement.

Read the full press release here.

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