Gymboree filed for bankruptcy in Richmond federal court on Wednesday. (Stock BizSense)
For the second time in two years, a children's clothing company based in San Francisco is seeking refuge in the Richmond bankruptcy courts, in a move that is good news for some local lawyers and bad news for three local shopping centers.
Gymboree, which also owns the chains Crazy 8, and Janie and Jack, filed for bankruptcy in federal court in Richmond on Wednesday. In line with the presentation, the company announced a plan to close most of its remaining stores, including a Gymboree location at Short Pump Town Center and three Crazy 8 outposts at Willow Lawn, Short Pump Town Center and Chesterfield Towne Center .
Local lawyers were the immediate beneficiaries of the presentation, as the company recruited Michael Condyles, Peter Barrett, Jeremy Williams and Brian Richardson of Kutak Rock to handle their Chapter 11 case.
Some of the retailer's creditors have already hired local representatives, such as Douglas Foley of McGuireWoods on behalf of the Goldman Sachs Specialized Loan Group and Tyler Brown of Hunton Andrew Kurth on behalf of Bank of America.
The Willow Lawn store of Crazy8. The chain stores at Short Pump Town Center and Chesterfield Towne Center will also close. (Mike Platania)
Judge Keith Phillips presides over the case, which is the latest example of a national corporation, out of town, coming to Richmond to get out of trouble.
The Richmond division of the US Bankruptcy Court. UU., Located in the federal court of East Broad Street, has developed a reputation for managing long corporate bankruptcies in a way that some consider favorable to large debtors.
Toys & # 39; R & # 39; R & # 39; Us made a similar duck to cover here in 2017, in a case that is still in the center.
Gymboree's latest submission is a return to Chapter 11 for the company, which applied for bankruptcy protection here in June 2017. It emerged from that first filing by eliminating $ 900 million in debt and closing 350 of its 1,300 stores in all the country. That round included the closing of four local stores in Stony Point Fashion Park, Regency Square, Virginia Center Commons and Chesterfield Towne Center.
Although this time it has less debt, the company said it plans to close the remaining stores of Gymboree and Crazy 8, and plans to sell its chain Janie and Jack, as well as Gymboree's online store and other intellectual property.
Gymboree's initial submissions on Wednesday indicate that the company has "severely limited liquidity, significantly below the level required to allow (Gymboree) to achieve certain transactions that maximize value."
He said his liquidity is limited due to several factors, including "industry trends and a too-widespread store footprint."
It lists between $ 100 million and $ 500 million in badets and between $ 50 million and $ 100 million in liabilities owed to between 5,000 and 10,000 creditors. In its 2017 presentation, Gymboree listed $ 756 million in badets and $ 1.3 billion in liabilities.
The corporation made presentations from 11 different entities and is requesting that they be merged into a single case at Gymboree Group Inc.
The first hearings were held in Richmond on Thursday, with another hearing scheduled for 10 am on February 15.
The Goldman Sachs subsidiary, Special Situations Investing Group, will be the stalking bidder for Janie and Jack's disposition and the other badets, which the company said it intends to sell through auction on February 25.