The Aldo Group Inc. wants to restructure its debt via bankruptcy.
The Montreal-based footwear and accessories retailer has started a court restructuring process and has obtained protection through the Companies’ Creditors Arrangement Act in Canada. It has applied for similar protection in the U.S., and plans to do the same in Switzerland.
Aldo said it intends to use the proceedings to stabilize the business and build on its legacy in retail fashion. The news came the same day that Neiman Marcus Group filed for bankruptcy protection.
“It is no secret that the retail industry has experienced rapid and significant change over the last several years,” David Bensadoun, CEO, Aldo. “We were making strong progress with the transformation of our business to tackle these challenges; however, the impact of the COVID-19 pandemic has put too much pressure on our business and our cash flows. After conducting an exhaustive review of strategic alternatives, we determined that filing under CCAA and related proceedings is in Aldo's best interest to preserve the company for the long term and survive through this challenging period."
Aldo said it plans to carry on business throughout the process while it develops and implements a comprehensive restructuring plan across the organization.
“With our deep fashion footwear heritage, experienced leadership team, extensive omnichannel capabilities and loyal customer base, we firmly believe that we will emerge from the restructuring process and from the challenges posed by the COVID-19 pandemic.," added Bensadoun. “We will come out stronger and well-positioned to continue leading the way in fashion retail.”
The company’s e-commerce websites will remain open throughout the process. Aldo’s corporate stores, which are temporarily closed due to COVID-19, will re-open based on the guidelines set by local governments and health authorities.