Craft retailer Joan has filed for bankruptcy for the second time
‘Barron’s’ Associate Editor Andrew Barry analyzes Dollar General and Target stocks.
For the second time in less than a year, Joanne Inc. has filed for Chapter 11 bankruptcy protection. At this time, he is trying to sell himself to another company in an effort to “maximize the value of his business”.
Interim CEO Michael Prendergast said Tuesday that the Ohio-based craft retailer has been struggling with a challenging retail environment.
That, combined with declining sales and limited inventory levels, forced the company to once again file for bankruptcy protection in the District of Delaware bankruptcy court.
In the year In March 2024, the company filed for Chapter 11 for the first time after 81 years in business, and subsequently became a private company. At the time, it did not close more than 800 locations in 49 states.
Lease for about 700 Party City spaces
“After carefully evaluating all available strategic options, we have determined that initiating a court-supervised sale process is the best course of action to maximize the value of the business,” Prendergast said. “We hope that this process will allow us to find a way to allow Joan to continue working as a concern.”
A customer walks into Joan’s store in El Cerrito, California, USA on Wednesday, January 8, 2025. (David Paul Morris/Bloomberg via Getty Images/Getty Images)
The company announced that it is seeking court approval to begin the process of selling all of its assets to Gordon Brothers Retail Partners LLC. Gordon serves as a “spinning horse” bidder, a party who agrees to make an initial bid for a bankrupt company’s assets, often before a formal bidding process begins.
According to Joanne, Gordon Brothers has indicated that it intends to pursue liquidation of the company and conduct out-of-business sales at all store locations.
Joan’s Fabric Store in Wyomissing, Pennsylvania. (Tim Liddy/Media News Group/Reading Eagle via Getty Images/Getty Images)
Party City is going out of business after 40 years.
The Company continues to actively solicit alternate bids. He said he has received inquiries from parties interested in continuing to operate the stores and online businesses.
If other qualified bids are submitted in the court-supervised sale process, Joan plans to hold an auction or auctions, setting the stage for the bidding process with the pony auction.
Get FOX BUSINESS on the go by clicking here
Until then, the company plans to keep all stores open. His online store will continue to operate as usual. The company also announced that the employees will receive pay and benefits.
