- Marjorie van Elven |
Gymboree Group Inc., the parent company of childrenswear brands Gymboree, Crazy 8 and Janie and Jack, has filed for relief under Chapter 11 of the Bankruptcy Code in the US Bankruptcy Court for the second time in two years. The company, which operates hundreds of stores in the United States, Canada and Puerto Rico, has also announced that its Canadian subsidiary, Gymboree Inc., intends to seek protection under the Bankruptcy and Insolvency Act of Canada (BIA).
The company informed in a statement that these proceedings will be used to facilitate the phasing out of all Gymboree and Crazy 8 stores and operations. Gymboree’s intellectual property and online platform, however, are up for sale, as is Janie and Jack. Special Situations Investing Group (SSIG), an affiliate of Goldman Sachs & Co, has entered into an asset-purchase agreement to act as the stalking-horse bidder in the court-supervised sale process of Janie and Jack and Gymboree’s ecommerce and intellectual property. Gymboree Group intends to conduct an auction no later than February 25.
“The company has worked diligently in recent months to explore options for Gymboree Group and its brands, and we are saddened and highly disappointed that we must move ahead with a wind-down of the Gymboree and Crazy 8 businesses”, said Gymboree Group’s CEO, Shaz Kahng, in the statement. She was appointed to the role in November.
The CEO added that the company is working to “minimize the impact” on its employees, customers, vendors and other stakeholders. The brands’ ecommerce continues to operate as usual for now. While the company has sought authorization from the Court to continue to honor gift cards for the next 30 days, the GymBucks and Gymboree Rewards programs have been discontinued, effective immediately. Gymboree Play & Music, which operates over 800 franchised and company-operated Play & Music centers worldwide, is a separate company since 2016 and therefore is not a part of the Chapter 11 proceedings.
Additional information about Gymboree Group’s Chapter 11 filing can be found at www.gymboreegrouprestructuring.com. In Canada, information is available at KPMG’s website.
Gymboree was founded in 1976 in San Francisco, California, and was acquired by Bain Capital in 2010. The company first filed for bankruptcy in 2017, closing about 350 of its 1281 stores. Now, it estimates 900 additional stores in the US and Canada will close doors.
Picture: Gymboree Facebook