Anna's Linens has officially filed for relief under the Chapter 11 Bankruptcy Code. The company will continue to operate its stores as debtors-in-possession under the provision of the U.S. Bankruptcy Court.
News that the company may be seeking relief and a buyer broke last week. Anna's Linens has more than 300 stores. Recent expansion has weighed financially on the company and taken focus away from online sales. The company also filed for Chapter 11 protection in 1993 and emerged the following year.
Anna's Linens is not the only houseware store to feel the impact of increased consumer shopping online. Bed Bath & Beyond (NASDAQ:BBBY) reported a 4 percent drop in profits in the latest quarter. More consumers are buying home furnishings online as e-commerce now accounts for 10 percent of the home furnishings market.
Anna's Linens has negotiated a financing arrangement with Salus Capital, the company's prepetition lender. The financing will give the company immediate funds to meet obligations, which includes the payment of employees and the delivery of products.
The retailer is working to negotiate a sale to DW Partners, a multistrategy fund manager. Anna's Linens will release more details with respect to the Chapter 11 filing as they become available.
-See this press release
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