Joyce Leslie filed a voluntary petition for Chapter 11 bankruptcy court protection in White Plains, N.Y. and will likely liquidate.
In the filing on Saturday, Lee Diercks, chief restructuring officer, said the company will try to find a going-concern buyer for the chain, and if one fails to materialize will target the start of liquidation sales in early February per an agreement with SB Capital Group, Tiger Capital Group and 360 Merchant Solutions.
According to Diercks, in a declaration filed with the bankruptcy case, the retailer operates 47 women’s apparel stores throughout New York, New Jersey, Pennsylvania and Connecticut. The chain targets young women between ages 15 to 35.
Founded by Julius Gewirtz and his wife Hermine in 1947, the company’s stock is held by their daughters Joyce Gewirtz Segal and Nancy Shapiro, each holding a 50 percent stake.
The chief restructuring officer said the chain experienced a drop in sales in late 2012, which intensified over the years. At the end of January 2012, it posted $104 million in sales, which dropped to $98 million in January 2013. The company expects to post annual sales of $63 million for the fiscal year that ends in January 2016. He said the business was hurt by a shift in consumer-spending patterns, increased competition by more nimble competitors and the lack of a sophisticated e-commerce platform in a technology-driven environment.
As of the petition date, the retailer had $4 million of inventory at cost, or $10 million at retail. It also recently paid down a secured debt in the amount of $662,000.00 owed to Everbank Financial Corp. in connection with a prepetition revolving credit facility.
Diercks also said that at the moment it doesn’t look like there is a going-concern buyer, although there is a potential suitor interested in acquiring a number of store locations.
According to bankruptcy court documents, the company’s total assets are pegged at $7 million, with total liabilities at $9 million.