Gymboree CEO to Step Down From Ailing Chain as Debt Wall Loomsby
Executive cites ‘evolving needs’ of company in making move
Children’s apparel brand was taken private by Bain Capital
Gymboree Corp. Chief Executive Officer Mark Breitbard plans to step down from the embattled retailer, which faces mounting losses and a wall of debt due next year.
Breitbard will take the role of chairman on Feb. 1 and leave the CEO job once a successor has been named, according to a statement Thursday. The executive cited the “evolving needs” of the company as the reason it should identify a new leader.
“We continue to focus on the strategic plans for our brands,” he said in the statement.
The children’s apparel company, which was taken private by Bain Capital in 2010 in a deal valued at about $1.8 billion, reported a $10.9 million quarterly loss last month. It had cash on hand of $9.7 million at the end of the period.
Like many clothing sellers that loaded up on debt during buyouts, Gymboree has struggled to cope with a changing retail landscape. Sluggish mall traffic and a shift of spending online has made it difficult to maintain brick-and-mortar chains. The Limited, once a fixture of U.S. shopping centers, said this month it would shutter all its stores and file for bankruptcy.
Gymboree, based in San Francisco, has a term loan of more than $760 million due in February 2018. A group of lenders has hired Rothschild Inc. to advise them as the retailer faces a potential restructuring of its $1 billion debt this year, Bloomberg reported this week.