The proliferation of wedding gowns means brides-to-be have more options.

David’s Bridal could be headed for a legal separation.

The retailer, which is owned by private equity firms Clayton, Dubilier & Rice and Leonard Green & Partners, on Monday missed an interest payment on $270 million in unsecured notes.

Mathew Christy, a retail analyst at S&P Global Ratings said the move is often a first step for a company considering bankruptcy.

In the case of David’s Bridal, he said, the company simply has too much debt. That, mixed with changing consumer preferences and declining marriage rates, “has led them to the position they’re in,” he said, calling it an “onerous situation.”

Legally, David’s Bridal has 30 days to catch up on payments, but Christy said that is unlikely to happen.

“They’re maintaining liquidity ahead of some sort of formal restructuring,” he said.  

The debt rating agency lowered David’s Bridal issuer credit rating from “CCC-minus,” which means the borrower is “vulnerable to nonpayment,” to “SD,” or where the borrower has selectively defaulted on its loan, but plans to continue making payments.  

S&P said, “It’s highly likely the company will not make the interest payment in full within the stated grace period.”

David’s Bridal, which has more than 300 stores around the globe, including locations in the U.S., U.K., Canada and Puerto Rico, is best known for its line of affordable gowns and wedding accessories.  

But the convenience of online shopping has made it hard for the company to compete. Many brides-to-be, saddled with excessive wedding costs, use the Internet to shop around and find the best deals. In addition, as American fashion becomes more casual, so does the wedding dress.

“On the other end of the spectrum are brides who can spend a significant amount of money,” Christy said. “They’re going to luxury boutiques.”  

And the entire industry is still aching from a decline in marriage rates throughout the country.

However, David’s Bridal said it’s here to stay. A representative said the company had the cash, but decided not to pay and was in discussions with lenders to reach a resolution.

“Our financial outlook is strong and we have ample liquidity to meet our key business objectives today and in the future,” the statement read.

“We have made the strategic decision not to make an interest payment due Oct. 15, 2018. This does not mean discussions will not continue,” the statement continued.

David’s Bridal is just one of many big names to have filed, or potentially filed, for bankruptcy this year. Retailers will often file bankruptcy as a way to restructure and renegotiate unfavorable leases, Christy said. Sears, Bon-Ton, Nine West, Rockport, Claire’s and A’gaci have all filed for bankruptcy in 2018.

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