Forever 21 files for bankruptcy, plans to close most of its stores in Asia and Europe

Business

Pedestrians pass in front of a Forever 21 store in New York.

Scott Mlyn | CNBC

Apparel retailer Forever 21 said Sunday night it is filing for Chapter 11 bankruptcy protection.

The fast-fashion retailer obtained $275 million in financing from its existing lenders with JPMorgan Chase and $75 million in new capital from TPG Sixth Street Partners, as well as affiliated funds to help it support its operations in bankruptcy.

A spokesperson for the retailer said the company has requested approval to close up to 178 U.S. stores. Forever 21, whose aggressive real estate expansion weighed on its finances, has 815 stores globally.

The retailer is the seventh-largest tenant of mall-owner, Simon Property Group, by rent. 

Forever 21 plans to exit most of its international locations in Asia and Europe, the retailer said in a release. It will continue operations in Mexico and Latin America. It does not expect to exit any major markets in the U.S.

It is one of a growing list of retailers, including Barneys and Mattress Firm that have used bankruptcy protection help to downsize their footprints.

Los Angeles-based Forever 21 was founded in 1984. The closely held retailer helped usher in an era of “fast fashion” shopping: offering frequent new styles of inexpensive clothes.

This is breaking news please check back for updates

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