Aerosoles files for bankruptcy protection

The U.S. footwear company has filed for Chapter 11 seeking for bankruptcy protection and aiming to gain some time to implement operational and financial restructuring.

Aerosoles announced last week it had voluntarily filed petitions to reorganize under chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware. The filing is dated on September, 15 and indicates that the footwear retailer will continue to manage its stores and operate its businesses as "debtors in possession" under the jurisdiction of the Bankruptcy Court.

Sources close to the matter explain that this “reorganization” enables the implementation of the company's strategic plan to revitalize the brand and focus on growing the e-commerce, wholesale and international channels.

Aerosoles toclose 74 stores and focus on online and flagship stores

Following the filing, the retail group will close up to 74 of its stores. Aerosoles plans however to maintain four flagship stores in New York and New Jersey. “Customers may also continue to shop online, as the company continues to enhance its strong digital platform, and at leading retailers throughout North America,” added the shoe label in a statement.

Denise Incandela, the Company's Interim Chief Executive Officer, commented the reasons that have led company to make such a difficult decision: "For nearly 30 years, Aerosoles has proudly offered consumers stylish and comfortable footwear at a great value. This restructuring will enable Aerosoles to become a stronger, more vibrant brand, and position the Company for future growth."

"Incandela added that "by improving our financial structure and right-sizing our retail footprint, we will be able to refocus our business efforts on the execution of our turnaround strategy. We will continue to create product that leads the market in comfort and fashion, grow our ecommerce, wholesale and international businesses, and promote innovative new marketing campaigns that will drive our business forward."

The company expects to complete the restructuring within approximately four months. After such an overhaul, The reorganized business will focus its efforts on the ecommerce, wholesale and international businesses that have continued to gain strength in recent years.

"We sincerely appreciate the tremendous efforts of our employees and our partners as we work through the restructuring. We recognize that our success is dependent on the ongoing support of our employees and value the collective efforts of our field and corporate team members. We also appreciate the loyalty and support of our customers. This process will allow us to emerge as a stronger brand and company and reinforces our commitment to providing a superior shopping experience in stores and online," said Incandela.

Aerosoles' legal advisor in connection with the restructuring is Ropes & Gray LLP. Berkeley Research Group, LLC serves as its restructuring advisor and Piper Jaffray & Co. serves as its investment banker for the restructuring. Hilco Merchant Resources is assisting on store closings.

Image:Aerosoles, Collection A/W2017