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Forever 21's U.S. operating company filed for Chapter 11 bankruptcy on Sunday, marking the second time in six years.
F21 OpCo made the move after the retailer, once known for affordable, on-trend fashions among teenagers and younger adults, was unable to find a buyer for its roughly 350 U.S. stores.
With most stores inside malls, the retailer says it was crippled by dwindling foot traffic and increased competition from online retailers.
Some of the largest e-commerce competitors to the company are Amazon, Shein and Temu.
FOREVER 21 LIKELY TO SHUTTER REMAINING STORES WITH SECOND BANKRUPTCY NEARING
Shoppers walk past advertisements on the opening day of fast fashion e-commerce giant Shein, which is hosting a brick-and-mortar pop-up inside Forever 21 at the Ontario Mills Mall in Ontario on Thursday, Oct. 19, 2023. (Allen J. Schaben / Los Angeles Times / Getty Images)
Forever 21 was founded in Los Angeles in 1984 by South Korean immigrants. By 2016, it was operating around 800 stores globally, with 500 of those in the United States.
The clothing chain has faced issues since its first trip through bankruptcy in September 2019, during which it closed over 150 of its 534 stores and sold the rest.
BANKRUPT FOREVER 21'S FAST FASHION NOT QUICK ENOUGH TO SATISFY MILLENNIAL FOMO
A pedestrian walks by a Forever 21 store on Aug. 29, 2019 in San Francisco. (Justin Sullivan / Getty Images)
F21 OpCo is currently owned by Catalyst Brands, an entity formed on Jan. 8 through the merger of Forever 21's previous owner, Sparc Group, and JC Penney, a department store chain owned since 2020 by mall operators and Simon Property Group.
FOREVER 21 FILES FOR BANKRUPTCY PROTECTION
A sign advertising a store-wide sale is displayed in a window at a Forever 21 store that is prepared to close on Feb. 20, 2025 in San Francisco. (Justin Sullivan / Getty Images)
Last month, when news of the looming bankruptcy came to light, a source familiar with the matter told Bloomberg that the company was preparing to close at least 200 of its remaining 350 locations as part of the bankruptcy process.
Now, Reuters reports, F21 OpCo plans liquidation sales of its stores while it goes through a court‑supervised sale and marketing process for some or all of its assets.
PRESSURE FROM SHEIN, TEMU ACCELERATE RETAIL CLOSURES
A Forever 21 store in New York City on Friday, Feb. 7, 2025. (Yuki Iwamura/Bloomberg via Getty Images / Getty Images)
Its stores and website in the United States will remain open and continue serving customers, and its international stores remain unaffected.
The company listed its estimated assets in the range of $100 million to $500 million, according to a filing wit
