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Party City is closing forever.
CEO Barry Litwin said it was “necessary to immediately begin a divestment process” for the party supplies retailer, CNN reported Friday, citing comments from a Party City conference call with employees.
Speaking to Party City employees on Friday, Litvin said that Party City's “best efforts to overcome the problems it faced were not enough and that the company “did everything possible to prevent this outcome. “
A “Halloween Costumes” sign is displayed in the window of a Party City store in Richmond, Calif., on Sept. 22, 2020. (Getty Images)
According to this outlet, Party City employees will be out of a job after Friday. According to reports, the company is eyeing widespread store closures in early February.
Lots to start holding “going out of business” sales at remaining locations
Party City's retail footprint in North America includes More than 700 company-owned and franchised stores As of late October, according to a press release issued that month.
Problems from swellingdebt and other factors apparently hurt the company. FOX Business reached out to Party City for comment on its reported plans to permanently close.
Party City store in Miami on January 18, 2023. (Joe Rudel/Getty Images/Getty Images)
This reportedly comes nearly four decades after the company launched and about 14 months after emerging from bankruptcy.
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When the party city Completed its Chapter 11 bankruptcy process Last year, the company announced that it had “increased liquidity by eliminating nearly $1 billion in debt and significantly strengthened its Party City store portfolio by negotiating improved lease terms and exiting underperforming stores.” “
A Party City store in Rockaway, New Jersey, on September 6, 2019. (iStock)
It converted the debt into equity owned by its lenders.
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Party City was delisted from the New York Stock Exchange in January 2023 Bankruptcy process. Before that, it was traded on the stock exchange for about eight years.
Speculation swirled last week about the retailer re-examining bankruptcy.
While all company-owned stores are closing, a few dozen independent Party City locations will remain open.
“The local Party City franchises are not affected by the bankruptcy,” Austin, Texas-area franchisee Mitesh Patel told FOX Business. “There are a total of 29 franchise stores that will have their stores open and ready to continue serving their local communities.”
Burke-Duma contributed to this report.