Pacific Sunwear has reportedly struck a deal with Golden Gate Capital that would involve a debt-for-equity swap once it emerges from bankruptcy.
The news, first reported by Bloomberg, said the deal has moved up the Anaheim, Calif.-based retailer’s timetable for a bankruptcy filing from within the month to as early as Wednesday evening.
A spokesman for Pacific Sunwear could not be immediately reached for comment. Golden Gate, through a spokeswoman, declined comment.
Pacific Sunwear is the latest in rumored retailer bankruptcies, which has also included speculation about Sport Chalet owner Vestis Retail Group. It’s been a rugged stretch for retailers in general with 2015 bankruptcies that included Wet Seal, Quiksilver and American Apparel.
Pacific Sunwear carries brands such as RVCA, Huf, Vans, Adidas, Billabong and Kendall + Kylie across more than 600 stores.
The company missed an expected update to the markets with its fourth-quarter and full-year results last month. It’s most recent financial update was in December for the quarter ended Oct. 31 when net sales fell 3 percent from a year earlier to $205.9 million and its net loss widened to $3.4 million from the year-ago period. Same-store sales were off 3 percent in the October quarter.
The company’s multi-year turnaround has been a spotty one with a number of tactics employed to bring customers back into stores. These have included playing up heritage action sports brands, a move later followed by diversification away from action sports along with a greater focus on the women’s side with new brands such as Kendall + Kylie and Brandy Melville.
Pacific Sunwear’s shares closed up about 25 percent Wednesday and were also up in after hours trading to a market value of about $7 million. The company’s stock has plummeted about 63 percent in the past year.