Blog: Leonie BarrieChildren's Place going places?

Leonie Barrie | 12 October 2007

The Children's Place isn’t commenting on claims that it’s up for sale, but its recent run of bad luck might not mean these rumours are too far off the mark.

An ongoing dispute with The Walt Disney Company with whom it has an agreement to operate 328 Disney Stores, the resignation of CEO Ezra Dabah for violating the company's code of conduct on securities trades, and failing to file any quarterly reports since June 2006, are just some of the problems it has recently been up against.

And just when things looked like they couldn’t get any worse, this week its auditor, Deloitte & Touche, decided not to stand for re-election and the retailer was forced to slash its full year earnings forecast.

Prospective suitors are thought to include private equity and apparel firms, but they will need to be convinced there are opportunities to improve the company's performance – and that the information included in the company’s audits is sound.

Some analysts see the Disney Store business as the biggest hurdle to any sale though. Margins are low and a newly agreed $175m store remodeling schedule over the next four years will be a heavy financial drain. But exiting the agreement will be a costly option too.

US: Children's Place up for sale?


BLOG

Act now to keep receiving just-style newsletters

You may have noticed a red alert bar at the top of just-style’s weekly and daily newsletters asking you to “Act now to keep receiving the just-style newsletter.” ...

BLOG

Apparel imports into the US rose in June

Apparel imports into the US rose in June as merchants stocked up for summer and prepared for the back-to-school season, with imports from Vietnam continuing to surge....

BLOG

US retailers under pressure to grow sales as mall traffic slows

Under Armour is to close stores and cut jobs – around 2% of the company's global workforce – as part of new plans to build a stronger and smarter company with faster go-to-market speed and greater dig...

BLOG

Agile logistics key to new hybrid retail world

US retail giant Walmart has topped a list of the fastest growing retailers thanks to its investment in ensuring it has the right balance between its online and brick and mortar operations....

just-style homepage



Forgot your password?