Claire’s enters Chapter 11

October 2025 | DEALFRONT | BANKRUPTCY & CORPORATE RESTRUCTURING

Financier Worldwide Magazine

October 2025 Issue

After months of speculation and missed rent payments, Claire’s Stores filed for Chapter 11 bankruptcy protection in August.

Claire’s Holdings LLC and several of its US and Gibraltar-based subsidiaries, which operate Claire’s and ICING stores across the US, commenced voluntary Chapter 11 proceedings in the US Bankruptcy Court for the District of Delaware on 6 August. This marks the company’s second bankruptcy in seven years, driven by declining consumer spending, rising rent costs and tariffs on imports from countries such as China, Thailand and Vietnam.

Despite the filing, Claire’s retail stores in North America will remain open while the company explores strategic alternatives. Through ‘first day’ motions filed in the US and Canadian courts, Claire’s aims to maintain operations and continue paying employee wages and benefits.

According to Debtwire, Claire’s has a $496m loan due in December 2026 and has stopped paying interest and rent on underperforming stores. The company listed assets and liabilities between $1bn and $10bn.

Claire’s previously filed for bankruptcy in 2018, when it operated over 4500 stores globally. It now runs approximately 2750 locations across 17 countries, including its ICING brand. In 2018, the company eliminated $1.9bn in debt. In this latest filing, Claire’s reported around $690m in funded debt obligations. Its largest unsecured creditors include Studex Corp. ($10.8m), Premium Retail Services LLC (over $1.6 m) and Inspired Thinking (over $1.2m).

“This decision is difficult, but a necessary one,” said Chris Cramer, chief executive of Claire’s. “Increased competition, consumer spending trends and the ongoing shift away from brick-and-mortar retail, in combination with our current debt obligations and macroeconomic factors, necessitate this course of action for Claire’s and its stakeholders.”

On 25 August, Claire’s announced the closure of 291 stores across the US and Puerto Rico, including 235 Claire’s locations and 56 ICING stores. Store closing sales are underway, with closures expected to occur gradually.

In a major development, Claire’s sold its North American business to private equity firm Ames Watson for $104m. The firm intends to preserve a substantial retail footprint and work closely with Claire’s management to ensure a smooth transition. Ames Watson has previously invested in retail brands and expressed confidence in Claire’s long-term viability, citing its strong brand recognition among younger consumers and its established presence in malls and shopping centres.

In the UK, Claire’s, which operates 306 outlets across the UK and Ireland, appointed advisers from Interpath Advisory as joint administrators on 13 August. The administrators are continuing to trade the business while exploring options, including a potential sale. All UK stores remain open, although online orders have been suspended. Customers who placed orders before the administration will receive their goods if dispatched, but undelivered orders will not be fulfilled. Refunds for purchases made before 13 August are unavailable through Claire’s, and customers are advised to seek redress via their payment providers.

Claire’s UK sales fell nearly 1 percent in the year to 1 February 2024 to £136m, with a pre-tax loss of £4m, following a £5m loss the previous year. The latest accounts filed at Companies House show the company employs over 2150 people.

In France, Claire’s subsidiary was placed in receivership by the Paris Commercial Court on 24 July. The company operates 239 stores and employs 1323 people. Despite a 7 percent decline in annual sales, Claire’s France remains profitable, with net income rising to €1.3m in 2023-24. A tender process is underway, with bids due by 19 September.

Founded in 1961, Claire’s is owned by former creditors Elliott Management and Monarch Alternative Capital.

Richard Summerfield