Fashion retailer Forever 21 has filed for Chapter 11 bankruptcy protection in the US.
In a statement, the firm said it plans to “exit most international locations in Asia and Europe” but to continue to operate in Mexico and Latin America.
It expects to close up to 350 stores worldwide, a spokesperson said, including as many as 178 US stores.
The move comes as traditional retailers continue to struggle against rising competition from online rivals.
Chapter 11 protection postpones a US company’s obligations to its creditors, giving it time to reorganise its debts or sell parts of the business.
A Forever 21 spokesperson said it expects to have between 450 and 500 stores globally after this process, down from around 800 currently in operation.
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The California-based firm said it has requested the approval to close up to 178 stores across the US, but provided few details on other markets.
“Decisions as to which international locations will be closing are ongoing. We do not expect to exit any major markets in the US,” the spokesperson said.
Last week, the fast-fashion retailer said it would pull out of Japan by October due to “continued sluggish sales”.
The retailer sought to reassure its customers in a public letter on Sunday, saying “stores are open” and “it will continue to feel like a normal day”.
“This does not mean that we are going out of business – on the contrary, filing for bankruptcy protection is a deliberate and decisive step to put us on a successful track for the future.”
As part of the Chapter 11 proceedings, the firm said it has obtained $275m (£224m) in financing from existing lenders and $75m in new capital.
The firm’s Executive Vice President Linda Chang described the moves as an “important and necessary step to secure the future of our company, which will enable us to reorganize our business and reposition Forever 21”.
Founded in 1984, Forever 21 sells inexpensive, trendy clothing and accessories.
The retailer competes with other major high-street brands such as Zara and H&M.
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