Crabtree & Evelyn Ltd. files for bankruptcy
Connecticut based soap-maker, Crabtree & Evelyn Ltd., has become the next national chain to file for Chapter 11 bankruptcy protection. “We are confident that Chapter 11 gives us the opportunity to restructure the company with a business model that will be sustainable for long-term growth,” Stephen Bestwick, the retailer’s acting president, said in a statement.
In the US, Crabtree and Evelyn are currently running 126 stores across 34 states. Crabtree and Evelyn also sell products through 130 stores operated by affiliates outside the US, through unaffiliated gift shops carrying their products, and from its online site.
While the majority of their revenue comes from retail sales, largely in the U.S., Crabtree & Evelyn is actually wholly owned by a Malaysian company, Kuala Lumpur Kepong Bhd., that also owns palm oil and rubber plantations. The company is Malaysia’s third-largest palm oil producer.
Crabtree & Evelyn employs 950, it said in the bankruptcy filing.
The case is In re Crabtree & Evelyn Ltd., 09-14267, U.S. Bankruptcy Court, District of New York (Manhattan).
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This is the second major national chain (eddie Bauer) to file in the last few weeks, as we come to the end of the spring retail season. Are these isolated filings, or are they the beginning of a new wave of bankruptcies? As long as consumer spending remains weak, retailers will be under continuing pressure due to weak sales and substandard margins, and more will become at serious risk of failing.
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