Forever 21 Considers Filing Bankruptcy

(Photo Credit: TNS)

The fast-fashion chain and mall staple have not remained immune to the retail apocalypse

Mall superstar Forever 21 Inc. seems to be taking the hit from the retail curse and anonymous sources reported to Bloomberg that the company is considering filing a bankruptcy claim.

The international mall tenant has over 800 stores across North America, Europe, and parts of Asia. Filing for bankruptcy would allow the chain to vacate less profitable storefronts and reinvest that money into growing the business through online campaigns and profitable stores. Many of the stores occupy large retail blocks in shopping malls and plazas and leaving the area could pose difficulties for landlords as more and more retail stores are closing up shop.

The anonymous sources report that the company had tried to negotiate with potential investors in additional financing, but the conversations did not reach any agreements. Jin Sook and Do Won Chang, the power couple who founded the company in 1984, have had to consider the unfortunate file to recapitalize the brand.

The company is privately owned, and co-founders hope to maintain their large stake in the brand, making it increasingly difficult to strike deals.

The rumors of filing come after pop star Ariana Grande filed a multimillion-dollar lawsuit against the brand for using her likeness to gain profit without her agreement.

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