Forever 21 rescued by landlords in £62m deal
Two of Forever 21’s largest landlords have reportedly been given the go-ahead to acquire the company out of bankruptcy in a $80m (£62m) deal.
According to The Times, a bankruptcy judge has approved the deal which will see Simon Property Group and Brookfield Property Partners link up with Sports Illustrated owner Authentic Brands.
The new owners have also reportedly agreed to assume some of Forever 21’s liabilities.
According to the Financial Times, Jon Goulding, the chief restructuring officer, told the court that the alternative was an outright liquidation of the business.
Back in September last year, the company filed for Chapter 11 bankruptcy protection in the US and announced plans to exit international markets in Asia and Europe.
A Chapter 11 bankruptcy, similar to that of a Company Voluntary Agreement (CVA) in the UK, postpones a US company’s obligations to its creditors, giving it time to reorganise its debts or sell parts of the business.
At the time a spokesperson for the company revealed it expected to close up to 350 stores globally, including up to as many as 178 US stores. The news comes after Forever 21 confirmed it would close its three UK stores in London, Liverpool and Birmingham in 2020.
