By Eliza Ronalds-Hannon and Reshmi Basu | Bloomberg
The US-based operator of retailer Forever 21 is preparing to potentially close down its stores as part of a bankruptcy filing in the coming days, according to people with knowledge of the matter.
Efforts to find a buyer for the fast-fashion retailer to avoid a liquidation have so far failed, said the people, who asked not to be identified discussing private information. Talks with one potential bidder are ongoing, they said.
Also see: Forever 21 closing at least 13 more stores in Southern California
At its height, Forever 21 operated more than 500 locations in the US and at least 800 worldwide. Its US footprint has since shrunk to about 350 stores. Bloomberg previously reported Forever 21 was looking to close almost two-thirds of its locations as part of a bankruptcy process.
The Forever 21 trademark and intellectual property are owned by apparel and lifestyle label empire Authentic Brands, which licenses them to the operating company that would undergo a Chapter 11 process. Authentic plans to continue licensing the brand through new operating and e-commerce partners.
Job cuts: Forever 21 laying off 358 employees as it closes L.A. headquarters
Representatives for Authentic and the Forever 21 operator declined to comment.
The Forever 21 operating company became a unit of Catalyst Brands, which also owns JCPenney and Lucky Brand, through an acquisition in January.
Previously, it was owned by Sparc Group, a joint venture formed by Authentic and the mall owners Simon Property Group and Brookfield Properties, both large Forever 21 landlords, to help keep the chain alive after its first bankruptcy in 2019.