Retail bankruptcy and the companies that have benefited

Retail took one of the biggest hits in 2020 as cities were shut down by the pandemic. Many large retailers were barely hanging by a thread before the pandemic but weighed down by slumping foot traffic and sales, especially in strip malls, retail couldn't hang on any longer, and 2020 became the year of significant bankruptcy filings for the industry.

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What is Chapter 11 Bankruptcy?
Most of the retail companies who filed for bankruptcy did so under Chapter 11 so that they could preserve their profitable businesses while doing away with unprofitable stores and debt. The process requires the bankruptcy court to oversee the negotiations the business conducts with landlords, suppliers, and other creditors while management remains in full control of the business. This type of bankruptcy differs from a Chapter 7 filing where everything is liquidated and sold off, and the stores are shut down for good. - PrivCo Knowledge Bank

While retailers are shuffling debt, some companies are benefiting. 

• Retail E-commerce Ventures purchased Modell’s Sporting Goods in August for $3.6MM after it had filed for bankruptcy in March and liquidated many of its stores. The same company also acquired Pier 1 Imports in July for $21MM, after the home goods retailer filed for Chapter 11 bankruptcy in February.
• China-based Harbin Pharmaceutical Group acquired GNC for $770MM after the vitamins and supplements store filed for Chapter 11 bankruptcy in June.
• Aurify Brands purchased the US locations of Le Pain Quotidien after it filed for bankruptcy in May. 
• Simon Property Group, the largest mall owner in the US, was very active in purchasing a number of retailers, including Forever 21, Brooks Brothers, Lucky Brand, and J.C. Penney Company. 
• Simon Property Group partnered in 2019 with Authentic Brands in a joint venture to purchase Barney’s New York. 
• Sycamore Partners acquired the Ann Taylor, Loft, Lane Bryant, and Lou & Grey brands of Ascena Retail Group for $540MM after the retail group filed for bankruptcy in July.

• J Crew filed for bankruptcy in May and emerged from proceedings in August. 
• Neiman Marcus filed for Chapter 11 in May and its reorganization plan was approved in September.