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rue 21's reorganization plan gets court OK


rue21 has cleared a significant hurdle in its effort to move forward after declaring bankruptcy.

The teen apparel retailer announced that the U.S. Bankruptcy Court for the Western District of Pennsylvania confirmed the company's plan of reorganization, which clears the way for rue21 to emerge from the bankruptcy process after less than four months. Rue 21 filed for Chapter 11 protection in May 2017, listing $307 million in pre-petition assets. It filed a month after it said it would close 400 stores.

"We are very pleased to have moved through the restructuring process in a relatively short period," said Melanie Cox, CEO of rue21. "With the support of our lenders, our landlords, all of our business partners and the hard work of our team, the company has performed consistently well ahead of its liquidity plan, and exceeded its second quarter target for Adjusted EBITDA by over 200%."

The retailer expects its reorganization to become effective by September 15, 2017, once all closing conditions have been met.

Rue 21 currently operates 758 stores in 45 states in shopping malls, outlets and strip center.

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