Aéropostale Facing Liquidation After Bankruptcy Court Ruling

by MR Magazine Staff

Things look bad for Aéropostale after a court ruling that allows Sycamore Partners to bid on the teen retailer using debt owed rather than cash. It’s a complicated calculation that could force the retailer out of business entirely. Aéropostale borrowed roughly $150 million from Sycamore in 2014, but the relationship quickly turned contentious with Aéropostale accusing Sycamore of interfering with shipments and lines of credit. It filed for Chapter 11 bankruptcy protection in May, but in July announced it would not be able to emerge and scheduled an auction for its assets. That auction was supposed to take place last week but was delayed as the battle between the retailer and Sycamore became even more heated. Read more at Forbes.