Pacific Sunwear Said to Prepare Chapter 11 Bankruptcy Filingby and
Pacific Sunwear of California Inc., the long-struggling surfwear chain, is preparing to file for bankruptcy, according to people with knowledge of the situation.
The Chapter 11 filing could come as soon as next week, said one of the people, who asked not to be identified because the process isn’t public. The situation remains fluid, and the timing could change, the people said.
PacSun is the latest casualty of sluggish retail spending and shifting consumer tastes, which have pushed chains such as American Apparel Inc. and Quiksilver Inc. into bankruptcy court during the past year. PacSun has recorded losses every year since 2008, and its shares have plunged about 90 percent in the past 12 months.
The Anaheim, California-based company, which operated 613 stores as of December, didn’t immediately respond to a request for comment.
An affiliate of private equity firm Golden Gate Capital has provided PacSun with a $60 million senior secured term loan, giving it sway in a potential bankruptcy. San Francisco-based Golden Gate’s consumer and retail portfolio includes California Pizza Kitchen, Eddie Bauer and Payless ShoeSource.
PacSun shares fell 78 percent to 8 cents at the close in New York on Tuesday.