M&A News: Fashion Retailer Express (OTC:EXPR) Files for Bankruptcy

The fast-changing equations of consumer purchasing patterns have resulted in another casualty in the retail space. This week, multi-brand fashion retailer Express (OTC:EXPR) has followed in the footsteps of other major names, such as 99 Cents Only and Joann (OTC:JOANQ), in declaring bankruptcy.

Express’ Bankruptcy and Sale

Express has voluntarily filed for Chapter 11 proceedings in the Bankruptcy Court of Delaware. This action follows a non-binding letter of intent from a consortium led by WHP Global for the potential sale of a majority of Express’ retail stores and operations. Other names in the consortium include Simon Property Group and Brookfield Properties.

Notably, Express has received a new financing commitment of $35 million from its current lenders. Additionally, it received a $49 million cash boost from the IRS (Internal Revenue Service) under the CARES Act last week. The retailer now plans to continue operating its EXPRESS, Bonobos, and UpWest brands. Meanwhile, it will move toward right-sizing its lease portfolio and operations. As part of this plan, Express intends to shutter nearly 95 EXPRESS retail stores and all UpWest stores.

WHP owns leading brands such as Toys “R” Us, Isaac Mizrahi, Anne Klein, and Rag & Bone. It also has a 60% stake in the EXPRESS brand.

To summarise, the recent spate of bankruptcies highlights the changing landscape in consumer preferences as shoppers tighten their budgets amid persistently higher interest rates and economic uncertainties.

How Much Debt Does EXPR Have?

Today’s bankruptcy announcement comes after a nearly 96% drop in Express shares over the past year. According to the TipRanks Stock Analysis tool, the company’s total debt currently stands at about $881.6 million. Its enterprise value to EBITDA multiple currently stands at about 3.14.

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