Arcadia Group, the London-based parent of the Topshop and Topman fast-fashion brands, filed for bankruptcy in the U.S., and said it was closing its 11 U.S. stores. The company filed Chapter 15, the part of the U.S. bankruptcy code that deals with foreign insolvencies, listing its assets at $53 million and debt at $179 million.
Topshop launched in the U.S. in 2009, in Manhattan’s SoHo, amid a media and celebrity-filled blitz and grand ambitions. But similar to several other British fashion brands, it had a harder time than expected in cracking the U.S. market. The retailer also faced increased competition from other fast-fashion brands, both online and offline. [The Topshop brand is also sold at select Nordstrom locations, with the deal not impacted by the filing, according to Business Insider.)
The U.S. filing was not unexpected. It comes as Arcadia, whose portfolio of brands also includes Miss Selfridge, Evans and Dorothy Perkins, is currently pending approval of a restructuring plan that includes some 23 store closures across the U.K., as well as price cuts from landlords on rent. Another 25 more stores are slated for closure under separate insolvency proceedings, with Miss Selfridge and Evans bearing the brunt of the closures.
“Against a backdrop of challenging retail headwinds, changing consumer habits and ever-increasing online competition, we have seriously considered all possible strategic options to return the Group to a stable financial platform," stated Ian Grabiner, CEO, Arcadia Group. “This has been a tough but necessary decision for the business.”