PacSun to reportedly file for bankruptcy
According to Bloomberg, retail clothing brand Pacific Sunwear of California Inc. is preparing to file for bankruptcy. Representatives of PacSun have yet to comment on this, however the company's shares did drop 78 percent to 8 cents at the close in New York on Tuesday. You can view a snippet of the Bloomberg report below.
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The Chapter 11 filing could come as soon as next week, said one of the people, who asked not to be identified because the process isn’t public. The situation remains fluid, and the timing could change, the people said.
PacSun is the latest casualty of sluggish retail spending and shifting consumer tastes, which have pushed chains such as American Apparel Inc. and Quiksilver Inc. into bankruptcy court during the past year. PacSun has recorded losses every year since 2008, and its shares have plunged about 90 percent in the past 12 months.
The Anaheim, California-based company, which operated 613 stores as of December, didn’t immediately respond to a request for comment.
An affiliate of private equity firm Golden Gate Capital has provided PacSun with a $60 million senior secured term loan, giving it sway in a potential bankruptcy. San Francisco-based Golden Gate’s consumer and retail portfolio includes California Pizza Kitchen, Eddie Bauer and Payless ShoeSource.
