Claire’s skips rent payments, moving closer to bankruptcy filing

[NEW YORK] Claire’s Stores is inching closer to filing for Chapter 11 bankruptcy as the teen accessory chain elected to miss June and July rent payments on some stores, according to sources familiar with the matter.

The firm may seek protection as soon as this week, but doing so could take longer as the retailer finalises details of the filing, said the sources, who asked not to be identified discussing a private matter.

Claire’s has been exploring restructuring options, including a possible sale, amid weakened cash flow and a heavy debt burden. Earlier this year, it chose to conserve cash by deferring debt interest payments, Bloomberg reported at the time.

The retailer has struggled since a 2018 bankruptcy handed control to creditors including Elliott Management and Monarch Alternative Capital.

Representatives for Claire’s and Monarch did not respond to requests seeking comment. Elliott and Claire’s adviser Houlihan Lokey declined to comment.

Uncertainty about US tariff policy has raised questions about Claire’s ability to address a nearly $500 million loan due in December 2026. The market value of that loan has plunged to 37 US cents from 76 US cents in June, according to Bloomberg-compiled data. BLOOMBERG