American retailer rue21 to exit bankruptcy
Teen speciality apparel retailer rue21 is set to exit the bankruptcy process after the US Bankruptcy Court for the Western District of Pennsylvania approved its reorganisation plan.
The company filed a voluntary petition for reorganisation under Chapter 11 of the Bankruptcy Code in May.
In addition, rue21 had signed agreements with lenders to lower its debt and secure the additional capital needed for its restructuring programme.
rue21 CEO Melanie Cox said: "Today's confirmation represents an important step forward in rue21's ongoing business transformation to a sustainable business model for a high-performing retailer.
“With the support of our lenders, our landlords, all of our business partners and the hard work of our team, the company has performed consistently well ahead of its liquidity plan, and exceeded its second quarter target for adjusted EBITDA by over 200%."
The objective of the restructuring plan was to transform the company’s business into a more focused and highly performing retailer.
In April, the retailer initiated the closure process of around 400 underperforming stores in a bid to streamline operations, right-size its store count and shift its focus to better performing locations.
Cox further added: "rue21 can now move forward from a position of renewed strength, with a highly relevant brand, an enthusiastic and loyal customer base, hundreds of high-performing stores, and a rapidly growing e-commerce business supported by strong vendor relationships and terms that are trending well above plan."
rue21 currently operates 1,179 locations across the US.