Rue 21 may be headed towards possible bankruptcy

After just launching a new activewear collection, Rue 21 may be next in line to file for bankruptcy. According to financial sources, the brand has been listed as a potential company headed towards Chapter 11 bankruptcy.

According to Fitch Ratings Agency, the retailer was considered “at risk” as a company that could default in the next 12 months. As reported by WWD, bankers and credit analysts have kept “close tabs” on the company and its financial state. While Rue 21 has not confirmed not confirmed any of this to be true, it seems the company is still on bankruptcy watch.

It’s not unlikely that the fashion brand is headed in this direction, as many retailers have failed recently. Recently, retailers such as American Apparel, Agent Provocateur, Wet Seal have suffered from underperforming stores resulting in Chapter 11 bankruptcy. Rue 21 did state last month that it plans to close a couple of its flagships, bringing its number of operating stores down from 1,200 to approximately 800. Without any immediate improvements in this area, it’s possible that Rue 21 may be the next retailer headed towards a bankruptcy filing.