Claire's declares bankruptcy, plans to keep stores open

Claire's Joins Wal Mart In Pulling Children's Jewelry From China

Claire's, the teen jewelry and accessories retailer known for its iconic ear-piercing service, filed for Chapter 11 bankruptcy protection on Monday.

Claire's is the latest in a long list of recent USA retail bankruptcies, including Gymboree, Gander Mountain, Sports Authority Inc., Toys "R" Us, Vitamin World, RadioShack, The Limited, Rue21 and Payless shoes, among others.

The retailer has 7,500 locations in 45 countries and employs 17,000 people. The company is turning to Elliott Management and Monarch Alternative Capital to get rid of a $1.9 billion debt and return stronger by September 2018.

The US company behind Claire's Accessories has filed for bankruptcy protection as part of a move to reduce its debt by 1.9 billion US dollars (€1.5 billion).

Claire's does not plan to close stores during the restructuring process.

Anchorage is home to three different Claire's stores; one is located in the Dimond Mall, one is located in the 5th Avenue Mall, and one is located in the Northway Mall.

According to court papers, a debtor-in-possession, or DIP loan to fund operations in bankruptcy will include $75 million revolver and a $60 million term loan with Citibank N.A.as an agent to other lenders.

The company accrued the almost $2 billion debt after Apollo Global Management LLC purchased it for $3.1 billion in 2007. Claire's says an agreement with creditors will cut its debt and provide 575-million dollars in new capital. The retailer is still feeling the backlash from a string of private equity buyouts about a decade ago that saddled Claire's with burdensome payments.

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