Lord & Taylor, the nation’s first department store, is officially going out of business after filing for bankruptcy earlier this month.
On Thursday, the nearly 200-year-old company announced that all 38 remaining stores have started liquidation sales, and the website is currently offering up to 40% storewide.
"While we are still entertaining various opportunities, we believe it is prudent to simultaneously put the remainder of the stores into liquidation to maximize value of inventory for the estate while pursuing options for the company's brands," Lord & Taylor's chief restructuring officer Ed Kremer said in a statement obtained by CNN Business.
The news marks a reversal in the company's decision announced last week to close just 24 of its locations — leaving 14 stores open and operating.
In August 2019, online clothing rental service Le Tote purchased the struggling department store from Hudson's Bay Company. But, less than one year later as retailers across the country were forced to shut down due to the coronavirus pandemic, both Lord & Taylor and Le Tote filed for Chapter 11 bankruptcy protection in the Eastern District of Virginia on Aug. 2.
Le Tote, a San Francisco-based startup founded in 2012, paid $100 million in cash in 2019 to acquire the oldest American department store's brand and inventory, online operations and control of its 38 retail locations. However, according to The New York Times, Hudson's Bay Company agreed to still own all Lord & Taylor real estate and cover the property rent for three years.
The company was hit hard a few months after the sale at the start of the coronavirus pandemic which required the temporary shutdown of all Lord & Taylor retail stores. Although Lord & Taylor and Le Tote continued operating online throughout the pandemic, the company's mounting debt obligations led to the bankruptcy filing. According to Women's Wear Daily, Le Tote owes Liquidity Capital II, $8.5 million in bank debt. The bankruptcy filing states that Le Tote has between $100 million to $500 million in both assets and debts.
In early August, Lord & Taylor announced its plan to seek a new owner in a statement to customers shared on its website.
"Today we announced our search for a new owner who believes in our legacy and values. Part of our announcement also includes filing for Chapter 11 protection to overcome the unprecedented strain the COVID-19 pandemic has placed on our business," the brand's statement said.
"We will continue to offer superior service and value in store and online during the Chapter 11 case. There are no immediate changes to our ecommerce site or forms of payment, including Lord + Taylor gift cards and LT Rewards house cards," Lord & Taylor's statement continued. "Thank you for your support now more than ever."
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