Inside The Surprising Catherines Bankruptcy & Store Closures
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Catherines, a longtime leader in extended plus size fashion, has had a tumultuous few months culminating in a bankruptcy acquisition bidding war. Ascena, the parent company of Catherines, Lane Bryant, and Ann Taylor (among others), filed for Chapter 11 in July. Plans were announced to not only sell the e-commerce business and associated intellectual property as part of a Catherines bankruptcy auction, but The Curvy Fashionista reported that the intentions were to close all existing retail stores.
City Chic Collective Ltd quickly emerged as the leader of the bidding race with an initial offer of $16 million, described as a “stalking horse” by the WSJ. City Chic must have been confident in their strategy, as last week I received an email regarding potential future Catherine’s collaboration after the successful acquisition.
Unfortunately, the outcome of today’s action didn’t go as planned, and City Chic Ltd lost to Fullbeauty Brands, another longtime leader in extended plus size fashion. Disclosure: Fullbeauty Brands is a former client, specifically for the launch of its licensed brand, ellos. Fullbeauty won the bidding war with a final price of $40.8 million. City Chic’s offer came in second, at $39.9 million. What’s $900,000 between competitors? The sale is pending the judge’s approval at a hearing on Monday.
Fullbeauty Brands is an established player in the plus size space, achieving enormous success through influencer collaborations with Swimsuits For All, as well as Woman Within, Roaman’s, Jessica London, and fullbeauty.com. Catherines would fit better among Fullbeauty’s current stable of brands, as Roaman’s & Woman Within have similar size ranges to the newly acquired brand.
City Chic Ltd is no stranger to buying troubled plus size fashion brands. Last year, the corporation won Avenue Stores LLC for a final price of $16.5 million, up from an opening bid of $10 million. The deal was approved by a court last September. Similarly, all of Avenue’s 250 stores were also closed.
Although size-inclusive fashion has experienced exponential growth over the past few years, the economic impact of the pandemic cannot be ignored. The next 12-24 months will be crucial for the future of the industry with inevitably more bankruptcy filings.