America’s teens may have to find somewhere else to get their ears pierced. Claire’s, the chainstore known for its tween jewelry and ear piercing, declared bankruptcy on Monday, the latest retailer to succumb to the online shopping revolution.
Claire’s made the move as it announced it was looking to restructure $1.9bn in debts it built up after being taken over by Apollo Global Management in 2007. The company has struggled as mall traffic has declined and becomes the latest mall fixture to declare bankruptcy following Toys R Us and Sports Authority.
The company operates 7,500 stores across the world and, according to court filings, “has pierced over 100,000,000 ears worldwide”.
The retailer’s international subsidiaries are not part of the US bankruptcy filings, Claire’s said in a statement.
A business plan which accompanied the restructuring announcement made clear that Claire’s plans to reduce the number of stores it has in Europe as a whole by 154 to 915 by 2022 including 74 closures in 2018. It is not clear how many of those closures, if any, might be in the UK.
Like Toys R Us, Claire’s was taken over by venture capital companies and saddled with huge debts. Those debts cost it $183m a year in interest payments alone.
In a statement the company said it was “confident” that it would emerge from the restructuring and had “commenced its restructuring process from a position of unique operational strength”.
“This transaction substantially reduces the debt on our balance sheet and will enhance our efforts to provide the best possible experience for our customers,” Claire’s chief executive officer, Ron Marshall, said in a statement. “We will complete this process as a healthier, more profitable company, which will position us to be an even stronger business partner for our suppliers, concessions partners, and franchisees.”
Other retailers have struggled to save their businesses even after declaring bankruptcy. Toys R Us announced its bankruptcy in September 2017. Last week it said it would liquidate its business, closing 735 stores at a cost of 33,000 jobs.