(RepublicanDaily.org) – Beauty and skincare store chain The Body Shop has declared bankruptcy in the U.S. and Canada.
As a result, the U.K.-based company said that it will shuttering all its branches in the U.S. The company has around 50 stores all across America, with its entire U.S. arm considered non-operational since March 1. The U.S. subsidiary will undergo Chapter 7 insolvency proceedings, where the company’s assets will be sold to cover debts and other financial obligations to creditors. The shuttering also affects roughly 400 positions in the U.S., including jobs at a distribution center that still contains millions of dollars’ worth of inventory.
The company’s subsidiary in Canada, Body Shop Canada Limited, on the other hand, will stay open for business. The chain has 105 branches in Canada, but a number of these locations – 33 – have begun liquidation sales in line with proceedings related to the bankruptcy. The company said that its Canadian operations will be undergoing restructuring, and will be considering “strategic alternatives” going forward.
The bankruptcy filings come on the heels of the U.K.-based parent company’s collapse earlier in the year. In February, the company was bought by German private equity group, Aurelius, for £207 million (roughly $264.8 million). Aurelius then put the company into administration less than six weeks after the deal closed, citing poor sales over the years compounded by other financial challenges, which reportedly includes the inability to cover its obligations to its suppliers.
It is currently unknown how the current state of the company will affect its operations in Australia and New Zealand. The store has close to 100 stores in Australia and more than 20 locations in New Zealand.
The chain was founded in 1976 by Anita Roddick, who established the brand as part of an advocacy for more environmentally-friendly cosmetics and beauty products that were also free from animal testing.
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