Jeweler Alex and Ani has filed for Chapter 11 bankruptcy and has put its business up for sale.
The company has listed assets and liabilities in the $100 million to $500 million range each. Its largest unsecured creditors are mall owners Brookfield Property Partners LP and Simon Property Group, both of which are owed over $3 million overdue rent payments.
The company’s move to file for bankruptcy protection relieves it from its rental obligations while restructuring its business. It expects little to no disruption in its operation.
Alex and Ani currently employees 524 employees and has 74 active leases. A third of its stores, however, are still closed due to the pandemic, Bloomberg reported.
Not too long ago, Alex and Ani was valued at more than $1 billion. At its peak, the company operated 100 stores and employed 1,000 people, selling nearly 10 million bracelets annually. The company’s fortunes, however, took a hit as it struggled to keep up with demand and saw significant management turnover. It was also challenged with issues arising from surplus inventory, burdensome leases, which led its wholesale business to drop to 19 percent of the company’s revenue, down from 59 percent. The company was also reportedly hit by a ransomware attack in February last year.
The challenges arising from the onset of the coronavirus pandemic last year was seemingly the last nail in the coffin as the company was forced to shutter its physical stores, which led to significant sales losses.