Forever 21 reportedly closing 200 stores amid second bankruptcy

Fast fashion retailer Forever 21 is believed to be on the verge of closing 200 of its stores as its operator in the US, F21 OpCo, prepares for the launch of a bankruptcy process.

According to sources for Bloomberg News, this process will start next month, during which it is understood that a buyer will also be sought for the retailer’s remaining stores.

If no buyer is determined, Forever 21 is likely to liquidate its retail network of around 350 stores, the media outlet added.

Impacted Forever 21 stores are said to have lost money for years, with the company often believed to have withheld royalties and rent payments amid financial difficulties.

The ownership of Forever 21 will remain in the hands of its current parent company Authentic Brands Group, which licenses the retailer’s trademark and intellectual property to F21 OpCo.

In turn, this firm is said to now be associated with Catalyst Brands, the owner of JCPenney and Lucky, as stated by Bloomberg.

Whether F21 is sold or liquified by Catalyst, Authentic is believed to already be eyeing licensing deals for Forever 21 to other retailers and distributors.

Forever 21 had first filed for Chapter 11 bankruptcy in 2019, and had launched a process of restructuring that resulted in the closure of several locations and a withdrawal from the Japanese, EU and UK markets.

It was later acquired by Authentic Brands Group, Simon Property Group and Brookfield Property Group, which together sought to put an emphasis on the retailer’s Gen Z customers, as well as speed to market processes and a sustainable supply chain.

FashionUnited has contacted Forever 21 and Authentic Brands Group with requests to comment.