If you’ve got a gift card for The Limited gathering dust, you may want to use it before a potential bankruptcy could make that card worth less than the plastic it’s printed on.
In the last month, The Limited has made it known that it was exploring its options, maybe looking for a buyer. However, a bankruptcy filing is looking more likely: the company has given headquarters employees layoff notices, its interim CEO took off for a job running another clothing chain, and it reportedly hired a legal advisor and financial advisors to help with the process.
Would you like to buy a few hundred clothing stores? The owners are surely hoping that someone wants to in the coming weeks, which would help it to avoid a bankruptcy filing. Bloomberg reports that those ever-useful “people with knowledge of the matter” say that the company is preparing for a bankruptcy filing in the coming weeks, maybe in early 2017.
It’s also possible that some of the chain’s stores will stay in business after a bankruptcy filing, like the teen-focused chain Aeropostale, which is staying in business owned by a coalition of mall landlords.
If the company does file for bankruptcy protection, that will typically start a 30-day clock on any remaining gift cards. After that time is up, they’ll be worth maybe a few pennies if you file a claim as an unsecured creditor in the bankruptcy case, but still useful as a frost scraper for your car windshield.
The entire clothing business is in trouble now, with companies in significant debt like Aeropostale, Wet Seal, American Apparel, and PacSun restructuring or going out of business.
Industry experts blame younger shoppers who are more interested in experiences than in acquiring new clothes every season, and that’s part of what ails clothing stores, but here’s something to ponder: what does The Limited sell? What kind of clothing or what size range do they offer? Without the signs out front, could you tell it apart from an Express store in a lineup?
by Laura Northrup via Consumerist
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