Muji USA files for bankruptcy
Another retailer has filed for bankruptcy protection citing the impact of the COVID-19 pandemic.
Muji USA Ltd., the U.S. branch of the Japanese lifestyle retailer known for its minimalist home goods and clothing, has filed for Chapter 11 bankruptcy protection with plans to focus more on e-commerce. The filing does not affect the company’s business outside the United States. (Muji operates 975 stores around the world under the Muji and IDÉE banners, including more than 400 in Japan.)
Muji, which has 18 U.S. stores, said it plans to close some unprofitable locations and renegotiate rents. In a statement, the company said its website and reopened stores will remain open for business as it begins "constructive discussions with its lenders and other stakeholders regarding the terms of a financial restructuring plan."
The retailer listed assets and liabilities in the range of $50 million to $100 million, and estimated the number of creditors at 200 to 999 in its filing. Its main unsecured creditors are landlords, including Kent & Wythe Owners LLC in New York City (owned more than $273,600) and Westland Garden State Plaza Limited Partnership in Los Angeles (owed more than $262,000.)
“Muji has felt the devastating effects of the COVID-19 pandemic on in-store retail, and as a result will take this opportunity to refocus our efforts in the United States on key regional markets and e-commerce,” Muji USA’s CEO Satoshi Okazaki said in a statement. “We remain committed to bringing the best of Japanese lifestyle products to our American customers, and hope to swiftly bring this restructuring to a close in order to better serve them.”
Muji’s bankruptcy filing comes the same week as two other retailers — Brooks Brothers and Sur La Table — sought Chapter 11 protection. Similar to both, Muji had been struggling before the COVID-19 crisis. A bankruptcy statement from Muji parent company Ryohin Keikaku reportedly revealed that its business in the U.S. has been operating at a loss for the past three years, with a loss of around $10 million last year.