NEW YORK, United States, Thursday April 6, 2017 – Payless ShoeSource outlets in the Caribbean – except for one US Caribbean territory – have not been listed among 400 stores to be immediately shut down by the discount shoe chain.
After weeks of speculation, the footwear retailer announced that it filed for bankruptcy on Tuesday and would begin to restructure its operations, starting with the closure of “underperforming” stores in the United States and Puerto Rico.
Payless, which has about 4,400 stores in more than 30 countries, filed for Chapter 11 protection on less than US$1 billion in assets and US$10 billion in liabilities.
The company said in a statement that the filing, made in U.S. Bankruptcy Court of the Eastern District of Missouri, will “facilitate the financial and operational restructuring necessary to strengthen (the) balance sheet and position the company for long-term success.”
Payless Chief Executive Officer Paul Jones blamed the developments on a challenging retail environment.
“This is a difficult but necessary decision driven by the continued challenges of the retail environment, which will only intensify,” he said in a news release. “We will build a stronger Payless for our customers, vendors and suppliers, associates, business partners and other stakeholders through this process.”
For months now, Payless has been in talks with its lenders on a restructuring plan that at one point included closing as many as 1,000 stores – a quarter of the company’s locations –, reported Business Insider.
The company warned that additional store closures are possible in the future, saying that it planned to work aggressively to manage the remaining stores.
As part of the restructuring, Jones said the company will make investments in online expansion and additional product lines.
Payless joins a growing list of US retailers which announced outlet closures, with Sears, HHGregg, Macy’s, Kmart, JC Penney, Game Stop and Radio Shack all shuttering locations.