J.Crew Group

History

2020: Declaration of bankruptcy

At the beginning of May, 2020 one of the largest ritelyler of the USA declared J.Crew Group bankruptcy because of a coronavirus. The company submitted the application according to Article 11 of the Code about bankruptcies in court of Richmond (State of Virginia) allowing to carry out reorganization of activity and to freeze payments for a debt.

As a result of J.Crew Group agreed with group of creditors and bondholders to exchange a debt of about $2 billion for a share in 82% in the reorganized company.

The transaction about restructuring with creditors and bondholders provides getting out of the company of bankruptcy by September 11, 2020. The court provided to J.Crew Group access to the credit which is owned by the debtor, in the amount of $400 million. Creditors, including Anchorage Capital Group, LLC, GSO Capital Partners and Davidson Kempner Capital Management LP, will support its activity in the course of restructuring.

One of the largest ritelyler of the USA declared J.Crew Group bankruptcy because of a coronavirus

The court also authorized the company to continue to pay the salary and privileges to employees and to observe all programs of customer service, including the loyalty program, gift cards, returns and exchanges. J.Crew Group will pay suppliers for goods and the services provided after date of application on usual conditions.

The company began to lose money long before a coronavirus pandemic against the background of long-term drop in sales. The retailer recorded net loss in the amount of $78.8 million in the financial year which came to the end on February 1 at revenue in $2.54 billion. In March the company closed about 500 shops in connection with the restrictions introduced with the purpose to slow down rates of spread of a koronavirusny infection of COVID-19 as led to long imminent crisis. The time stop of work will deprive of J.Crew Group of $900 million more revenue, reported in the company.^[1]

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