The future of almost 20 branches of fashion accessories retailer Claire’s in the Republic has once more been thrown into doubt after its US parent company filed for bankruptcy protection for the second time in less than 10 years.
While all the stores contacted by The Irish Times on Wednesday morning remained open for business and were trading normally, the company’s financial difficulties in the US are significant and reports from the UK say at least some of the stores on this side of the Atlantic could be at risk in the months ahead.
Claire’s filed for Chapter 11 bankruptcy protection in the US last night with a court filing pointing to a slowdown in consumer spending, leading to lower sales.
The retailer, backed by Elliott Management and Monarch Alternative Capital, operates more than 2,750 stores across 17 countries in North America and Europe and listed its estimated assets and liabilities at between $1 billion and $10 billion (€860 million and $8.6 billion) respectively in a filing with the US bankruptcy court in Delaware.
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The company said it has between 25,001 and 50,000 creditors.
The retailer’s trading difficulties are understood to have been exacerbated by uncertainty surrounding tariffs imposed on China by the US administration, which is likely to have seen its overheads increase substantially in recent months.
Uncertainty as to how trade would be reshaped is only part of the problem faced by the company, which specialises in jewellery and accessories aimed at the teen and preteen market.
It is the second time Claire’s has filed for Chapter 11 bankruptcy and it has also had two failed attempts at a stock market IPO.
Restructuring firm Interpath was recently tasked by the parent company to find a buyer for the European operation but, according to reports from the UK, the company is struggling to find a financial backer for the hundreds of shops it operates across Europe, including in Ireland.
One industry source played down the prospects of an immediate closure but told Sky News that as many as one-third of its shops might be closed under a restructuring programme.
The Irish Times contacted Interpath but a spokesman said the company was not in a position to comment “at this time”.
