Gymboree also announced Monday the departure of Chief Financial Officer Andrew North. - From CNBC
The children's clothing retailer announced the move Monday morning, only a few weeks after it partnered with a turnaround firm, AlixPartners, to assist with its operations and then missed a June 1 debt payment.
"We expect to move through this process quickly and emerge as a stronger organization that is better positioned in today's evolving retail landscape." James Mesterharm, Gymboree's chief restructuring officer, said in a court filing that the retailer was hurt by lower-cost competition from rivals Children's Place and Gap, both of which have less debt financing.
Gymboree said 35 percent of its 1,300 stores are leased from real estate investment trusts, or REITs, GGP and Simon Property Group.
Its Gymboree-, Janie and Jack- and Crazy 8-braded stores tend to be located in malls, where weakening foot traffic has been hurting numerous specialty apparel tenants and department stores alike lately.
Gymboree said it expects to operate its overall business and the "majority of its stores" as usual during its financial restructuring and has made plans to pay its vendors for all goods and services delivered on or after June 11, 2017.