FILE – A car sits in the parking lot outside the JoAnn store in Davenport, Iowa. (Daniel Acker/Bloomberg via Getty Images)
Joanne, the craft and fabric chain, has filed for bankruptcy for the second time in less than a year.
The Ohio-based company first filed for bankruptcy in March 2024 and went private a month later to maintain its U.S. stores.
Why did Joanne file for bankruptcy again?
Joan is looking for a buyer to save her company from liquidation.
Under the proposed deal with the lender, which owes more than $450 million, Joan would be required to hold an auction within 30 days or the money would be held as collateral, according to court documents obtained by Bloomberg. There is a risk that they will lose access to their funds.
Related: Fabric and crafts chain Joanne files for bankruptcy.
Bloomberg reported that Joao would need court approval for the sale and that the company had received an offer from liquidator Gordon Brothers Retail Partners, which would be the first bid.
Court documents say Joan will hold an auction if a higher offer is made by February 12th. However, if no higher bid is made, Joan ends up selling to the Gordon brothers.
Additionally, the company had $615.7 million in financing obligations and $133 million in unpaid operating debt, according to Chapter 11 documents filed Wednesday in Delaware court.
Joanne CEO mentions bankruptcy
What they say:
“The past few years have presented significant and persistent challenges to the retail environment, and our current financial situation and “This, combined with constrained inventory levels, has forced us to take this action.” .
Joanne has 850 stores across the United States, and CNN noted that its stores and website will remain open while the company manages the sales process.
Back story:
Founded in 1943, Joanne filed for Chapter 11 bankruptcy protection in March 2024, with total assets of approximately $2.26 billion and total debt. was listed as more than $2.44 billion.
In its initial filing, Joan said the company has received approximately $132 million in new financing commitments and expects to reduce its debt by approximately $505 million.
The group did not say why the debt was rising, but the Associated Press reported last year that consumers were spending less on non-essentials due to inflation.
