Retailer Party City, which has been facing difficulties since the coronavirus pandemic, filed for Chapter 11 bankruptcy protection in the United States last weekend for the second time in two years.
The mentioned actions of the specified company are related to its intention to wind down retail and wholesale operations. The history of this brand has been more than 40 years. The company sells party supplies, including themed decorations and Christmas costumes.
The retailer said that the launched bankruptcy procedure will not cause the closure of all of its 700 stores in the United States. The company commences a going-out-of-business sale.
The retailer, along with some of its subsidiaries, filed for Chapter 11 in the US Bankruptcy Court for the Southern District of Texas. In a filing with the court, Party City Holdco listed both assets and liabilities in the range of $1 billion to $10 billion and estimated to have more than 10,000 creditors.
Senior lenders of Party City Holdco will provide the retailer with the financial support needed for funding operations during the wind-down process. The relevant information is contained in the company’s statement.
It is worth noting that retailers who find themselves in dire straits often seek bankruptcy protection during the holiday season. In this case, companies have the opportunity to use any cash infusion provided by recent sales.
Party City operates both brick-and-mortar stores and e-commerce websites. The company said it would retain most of its 12,000 employees for the sale period to assist with the wind-down process.
The retailer first filed for Chapter 11 bankruptcy protection in the United States in January last year.
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