Off-price retailer Century 21 has voluntarily filed for relief under Chapter 11 of the US Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York.
The move will help the company’s plans to wind down its retail operations. The retailer has decided to close all of its remaining 13 stores in New York, New Jersey, Pennsylvania and Florida.
It follows after its insurance providers refused to pay approximately $175m due under policies to protect Century 21 from losses arising from business disruption caused by Covid-19 pandemic.
Century 21 CEO Raymond Gindi said: “While insurance money helped us to rebuild after suffering the devastating impact of 9 / 11, we now have no viable alternative but to begin the closure of our beloved family business because our insurers, to whom we have paid significant premiums every year for protection against unforeseen circumstances like we are experiencing today, have turned their backs on us at this most critical time.
“While retailers across the board have suffered greatly due to Covid-19, and Century 21 is no exception, we are confident that had we received any meaningful portion of the insurance proceeds, we would have been able to save thousands of jobs and weather the storm, in hopes of another incredible recovery.”
BRG is serving as its financial advisor and Brian Cashman of BRG as the chief restructuring officer.
Last month, speciality off-price retailer Stein Mart, along with its subsidiaries, filed for Chapter 11 of the Bankruptcy Code in the US Bankruptcy Court for the Middle District of Florida–Jacksonville Division.
Recently, omnichannel fashion retailer Neiman Marcus secured approval from the US Bankruptcy Court for Southern District of Texas, Houston Division, for its reorganisation plan.