(Reuters) - Apparel brand Brooks Brothers filed for Chapter 11 bankruptcy on Wednesday, joining a list of decades-old American retailers that have crumbled under the impact of the coronavirus crisis.
The 200-year old apparel retailer, the first to tailor the button-down Polo shirt in 1896, said its strategic review process was still underway and the bankruptcy filing would help it obtain additional financing to facilitate the sale.
“During this strategic review, COVID-19 became immensely disruptive and took a toll on our business,” a company spokesperson said.
Owned by Italian billionaire Claudio Del Vecchio, the privately held company boasts of having dressed 40 former U.S. presidents including John F. Kennedy and Barack Obama and has about 500 stores around the world, most of which had to be closed due to coronavirus-led restrictions.
The company had already been struggling as corporate America, including Wall Street, relaxed its dress code for employees, allowing them to choose casual dressing over bespoke suits.
“The current pandemic has accelerated the challenges that the industry and our business have faced for some time,” the spokesperson said.
Disruptions in the retail sector led to luxury department store chain Neiman Marcus Group, clothing retailer J. Crew Group Inc and J.C. Penney Co Inc filing for bankruptcy protections after attempts to rework their finances failed.
Brooks Brothers said it secured $75 million in debtor-in-possession financing and that, along with cash flows from ongoing operations, would give it liquidity to support it through the sale process.
In a District of Delaware court filing, the company stated that it had assets and liabilities between $500 million and $1 billion.
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