SAN ANTONIO – Teen retail chain rue21 will reportedly close all of its 540 stores after it filed for Chapter 11 bankruptcy protection for the third time last week.
Stores will begin to close in the next four to six weeks, and “going out of business” sales will start soon, according to the court filing obtained by Retail Dive. The retail chain’s website also appears to be down.
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Rue21 has three locations in San Antonio — at South Park Mall, Westover Marketplace and Ingram Park Mall — and one in San Marcos — at Tanger Outlet Center.
Reuters reported that rue21 has $194.4 million in debt. The Warrendale, Pennsylvania-based chain had attempted to sell its business but no buyer came forward, according to Reuters.
The court filing stated that in the months leading up to the filing, rue21 had explored restructuring alternatives and began marketing their assets.
But during the process, the filing states, it became apparent that rue21′s value could not exceed proceeds from store closure sales and liquidation.
The filing states that rue21 “recently suffered operational losses stemming from, among other things, underperforming retail locations, the continued growth of online shopping and industry competition, inflation and macroeconomic headwinds, and difficulties raising capital in an amount sufficient to meet their liquidity needs and fund operations.”
Reuters reported that during its height, rue21 operated 1,000 stores in the U.S. It previously filed for bankruptcy in 2003 and 2017.
The chain will also sell its intellectual property, Reuters reported.
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