New York – U.S. discount retailer Payless ShoeSource Inc plans to close all of its approximately 2,300 stores when it files for bankruptcy later this month for the second time in as many years, people familiar with the matter said on Thursday.
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The move would make Payless one of the most high-profile victims of the string of bankruptcies that have hit the brick-and-mortar retail sector as more shopping is done online. Toys “R” Us and The Bon-Ton Stores are among the retailers that shut their stores in liquidations in the last 12 months.
Payless had been trying unsuccessfully to find a buyer. After no such deal could be clinched, the Topeka, Kansas-based company has decided to initiate preparations to liquidate, the sources said.
There is still a small chance a buyer could emerge after Payless files for bankruptcy, the sources said. In the meantime, the company is preparing to run going-out-of-business sales at its shops in the next week, one of the sources said.
The sources asked not to be identified because the liquidation preparations are confidential. Payless declined to comment.
Payless filed bankruptcy once before in April 2017, and exited 18 months ago, with about $400 million in loans, after slashing its debt pile from over $800 million, according to court papers. A group of creditors, including hedge fund Alden Global Capital LLC, took over ownership, according to bankruptcy court records.
Why didn’t thy just open the high end shoe store Palesi – their publicity stunt that went viral, selling their shoes for exorbitant prices to the rich & famous – who were willing to buy them at that price. That would have kept their low cost shoe stores open.