New York City — The U.S. arm of beauty retailer L’Occitane en Provence has filed for Chapter 11 bankruptcy protection and announced plans to close several stores in an effort to optimize the company’s 166-location U.S. footprint.
At least 23 stores are being targeted for closure in the U.S. and the company is taking a closer look at its other leases in hopes of better positioning L’Occitane for success over the next few years, according to reports by the New York Business Journal. Stores are set to remain open through the restructuring process.
L’Occitane is the latest regional mall mainstay to struggle under strain caused by the COVID-19 pandemic. The company was recently sued by Simon Property Group — one of the largest shopping mall operators in the U.S. — for more than $3.7 million in back rent, according to reports by Crain’s New York Business.
While L’Occitane has seen year-over-year growth in online sales, the business continues to feel the impact of high rent obligations, which the company deems no longer tenable.
“Today’s action is a pivotal step forward in achieving the full potential of L’Occitane’s U.S. business,” says Yann Tanini, managing director of L’Occitane North America, which is headquartered in New York City. “We look forward to working collaboratively with our landlords to achieve partnerships that make economic sense in the current retail environment and to best position our marquee brand’s boutique offering for years to come.”
Fox Rothschild LLP is serving as legal counsel, RK Consultants LLC is serving as financial advisor and Hilco Real Estate is serving as real estate advisor to the company during the Chapter 11 process.
L’Occitane was founded by Olivier Baussan more than 40 years ago with the goal of offering beauty products that speak to lifestyles found in the South of France. The company currently has 3,486 retail locations open across 90 countries.
— Katie Sloan