Natick Mall Store Files For Bankruptcy

Marcus Newton
March 20, 2018

The jewelry and accessories retailer known for its ear-piercing services at its Claire's and Icing stores filed for Chapter 11 bankruptcy in Delaware.

This marks yet another in a long ling of mall boutiques and big box stores filing for similar bankruptcy protections in 2018, with Toys R Us being the first retail giant to liquidate this year. Currently, Claire's sells products in more than 7,500 locations in 45 countries and employs about 17,000 people, according to USA Today.

In fact, while Claire's has been closing stores, it expects to open 4,000 concessions (stores within stores) in 2018, Claire's said on Monday.

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Private-equity firm Apollo Global Management holds a 97 percent stake in Claire's, and pushed the initial buyout plan. The Company's iconic ear piercing services are unmatched and can not be replicated online. The company also had too much debt, costing it $183 million a year alone in interest payments, he said. If all goes well, the company says that this will reduce its debt by roughly $1.9 billion.

Claire's said on Monday that it has obtained $135 million in debtor-in-possession financing commitments, including an asset-based lending facility and a term loan from Citigroup. The company now has $1.9 billion in debt on its books, with $1.4 billon of funded debt due to mature next year. Cash flows from operations, coupled with the RSA and the Company's fully-underwritten $135 million DIP facility from Citi, will provide Claire's with ample liquidity to enter into, operate within, and emerge from chapter 11 seamlessly. RadioShack filed for a second bankruptcy in March 2017.

Other reports by MaliBehiribAe

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