US children’s apparel retailer Gymboree Group has officially filed for voluntary Chapter 11 bankruptcy protection for the second time.
The company, which first filed for voluntary Chapter 11 bankruptcy protection in June 2017, said it and its US subsidiaries voluntarily filed for relief in the US Bankruptcy Court for the Eastern District of Virginia last week.
The group’s Canadian subsidiary, Gymboree Inc, intends to seek protection in proceedings pursuant to the Bankruptcy and Insolvency Act of Canada (BIA) in the Ontario Superior Court of Justice.
Gymboree Group said it intends to use these proceedings to facilitate an orderly wind-down of all of its Gymboree and Crazy 8 store locations and operations while continuing to pursue a going concern sale of its Janie and Jack business and a sale of the intellectual property and online platform for Gymboree.
In addition, the San Francisco-based retailer has entered into an asset purchase agreement with Special Situations Investing Group Inc (SSIG), an affiliate of Goldman Sachs & Co, pursuant to which SSIG will serve as the stalking-horse bidder in a court-supervised sale process for Janie and Jack.
As per the agreement, SSIG has agreed to acquire the Janie and Jack business and the intellectual property and online platform for Gymboree. The agreement sets the floor for the auction, which is designed to achieve the highest or otherwise best offer, subject to approval by the Bankruptcy Court.
“The company has worked diligently in recent months to explore options for Gymboree Group and its brands, and we are saddened and highly disappointed that we must move ahead with a wind-down of the Gymboree and Crazy 8 businesses,” Shaz Kahng, appointed as CEO in November, said. “At the same time, we are focused on using this process to preserve the Janie and Jack business – a strong brand that is poised to grow – by pursuing a sale of the business as a going concern. As we move ahead, we are working to minimise the impact on our employees, customers, vendors, and other stakeholders.”