Struggling apparel retailer Bebe to shut all stores by end of May
Amid competition from Amazon, H&M and Zara, Bebe is liquidating merchandise and its store fixtures without specifying any future plans
Struggling apparel retailer Bebe said on Friday that it would close all its stores by the end of May, barely a month after announcing it was exploring strategic alternatives following four years of losses.
The company, which had 180 stores at the end of 2016, also plans to liquidate all merchandise and fixtures within the stores, it said in a regulatory filing. Shares of the company hit a 14-month low of $3.02 in morning trading.
Bloomberg reported last month that Bebe was planning to shut stores and seek a turnaround as an online brand to avoid filing for bankruptcy.
A number of apparel retailers have gone bankrupt in the last couple of years, including Aéropostale and The Limited, due to lacklustre demand as they battle stiff competition from Amazon.com and fast-fashion retailers such as H&M and Zara.
Bebe expects to recognise an impairment charge of about $20m from the store closures, which will be recorded in the third and fourth quarters. The California-based retailer, known for its form-fitting dresses, did not say what its future plans were.
The company will also pay advisers B Riley &Co and Tiger Capital Group $550,000 and 15% of the gross proceeds from the sale of store fixtures.