Shopping for young children at mall department stores can be a challenge for parents seeking the right style or size of garments unless they visit the store after it has been recently restocked.
I can usually find an adequate number of styles and sizes, however, at children’s specialty apparel stores, such as Carter’s, Oshkosh, or The Children’s Place.
It’s going to get a lot more difficult finding kids’ apparel if The Children’s Place and Gymboree start closing stores.
The Children’s Place filed for Chapter 11 bankruptcy protection seeking a sale of its assets as a going concern.
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The Children’s Place files bankruptcy
The Children’s Place specialty apparel retail chain, which also operates Gymboree retail stores, filed for Chapter 11 protection to reorganize its business and seek a buyer for all of its assets as a going concern.
The Secaucus, N.J.-based debtor and 13 affiliates filed their petition in the U.S. Bankruptcy Court for the District of New Jersey on Nov. 8, listing $742.3 million in assets and $881.2 million in debts.
The 57-year-old debtor will also file a Canadian proceeding under the Companies’ Creditors Arrangement Act in the Ontario Superior Court of Justice in Toronto. The debtor seeks Canadian recognition of the Chapter 11 case as a foreign main proceeding under the CCAA filing.
The Children’s Place’s largest unsecured creditors include Hansae Co. Ltd., owed over $15.3 million; J.D. United Trading Corporation Ltd., owed over $6.7 million; The Investment and Trading Joint, owed over $6.2 million; U-Knits Inc., owed over $5.5 million; Fast Sky Holdings Ltd., owed over $4.4 million; and Atraco Industrial Enterprises, owed over $4.4 million.
Debtor will seek a sale of company
The debtor is negotiating with several investors regarding potential sale transactions that would allow the company to continue operating as a going concern and preserve the value of its brands, the company said in a Nov. 8 statement
The company plans to submit a bidding procedures motion with the court to obtain the highest and best offer for the company’s assets through a Section 363 bankruptcy sale. The debtor is seeking a bid deadline of Dec. 9, 2026, with a sale transaction completed by the end of December, the statement said.
Seeks DIP loan from secured lenders
The Children’s Place will also seek debtor-in-possession financing from its prepetition secured lenders.
The Children’s Place has sent notices to employees of its Fort Payne, Ala., distribution center that it will close the facility permanently because of financial difficulties on Jan. 5, 2027, and lay off all 593 employees, according to WAFF-TV.
The debtor’s stores and e-commerce sites will remain open and continue operating and serving customers, the statement said. The company has hired advisers GA Group, Tiger Group, and SB360 Capital Partners to conduct inventory sales, according to the statement but did not list any specific stores that it will shutter.
Company closed 250 stores
The debtor has faced financial distress since 2024, when declining liquidity led to the chain closing 250 stores. It was also considering bankruptcy at the time, as TheStreet reported.
The Children’s Place, which was founded in 1969, operates 495 stores, including Gymboree, Sugar and Jade, and PJ Place locations, across North America, as well as an e-commerce platform, according to the company’s Investors Relations page.
The company designs and sources children’s apparel, accessories, and footwear through third-party manufacturers and sells them at value prices for babies, toddlers, and children. Various franchise and wholesale partners distribute the company’s products
Mithaq Capital SPC holds 61.1% of the company’s equity, according to the debtor’s petition.
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