Published: Tue, March 20, 2018
Money | By Wilma Wheeler

Claire's Stores Declares Bankruptcy

Claire's Stores Declares Bankruptcy

After months of speculation, teen mall staple Claire's Stores Inc. today pulled the trigger, filing for Chapter 11 protection in the U.S. Bankruptcy Court for the District of Delaware.

Claire's, the fashion and jewelry mall retailer, is filing for Chapter 11 bankruptcy.

Besides the Claire's chain, the company also operates Icing stores.

Unlike other retailers that have come before it, Claire's has commenced its restructuring process from a position of unique operational strength.

Toys "R" Us first filed for bankruptcy in September and is now planning to liquidate and close or sell its 800 stores in the USA, according toThe Washington Post.

The jewelry chain Claire's filed for bankruptcy on Monday.

"The company's iconic ear piercing services are unmatched and can not be replicated online", the company said.

"A Claire's store is located in approximately 99% of major shopping malls throughout the United States", Claire's said in a bankruptcy filing, citing data showing that traffic to malls had declined 8% over the past year.

The company's comeback strategy relies in large part on ear piercing, a service it has offered since 1978 and that can't be offered online.

The company announced no store closings.

But even a business model that "remains a compelling proposition over the long term" wasn't enough to immunize the company from a decline in mall traffic, which fell around 8 percent year-over-year, Huckins said in a court affidavit.

"A Claire's store is located in approximately 99% of major shopping malls throughout the United States", the company said. If all goes well, the company says that this will reduce its debt by roughly $1.9 billion.

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