J. Crew has filed for bankruptcy, becoming the first major US retailer to do so amid the ongoing global COVID-19 pandemic. In a statement released early Monday morning, May 4, the retailer—made popular by the likes of Meghan Markle and Michelle Obama—said it has filed for Chapter 11 bankruptcy and is working with its lenders to convert $1.65 billion of the company’s debt into equity.
Chapter 11 bankruptcy isn’t exactly a death sentence. As J. Crew chief executive officer Jan Singer explained in the statement, while the company continues its restructuring process, “we will continue to provide our customers with the exceptional merchandise and service they expect from us, and we will continue all day-to-day operations, albeit under these extraordinary COVID-19-related circumstances. As we look to reopen our stores as quickly and safely as possible, this comprehensive financial restructuring should enable our business and brands to thrive for years to come.”
Madewell, J. Crew’s sister brand helmed by Libby Wadle, will continue its day-to-day operations with Wadle.
“J.Crew and Madewell are two classic American brands with deeply loyal customers. We look forward to supporting Jan, Libby and the management team to recognize their full potential,” Kevin Ulrich, chief executive officer of Anchorage Capital Group, one of J. Crew’s lenders, added. “The significant deleveraging contemplated by this agreement, coupled with J.Crew Group’s strategy to strengthen its robust e-commerce platform to drive continued growth in its direct-to-consumer segment, will position the Company for future success.”
The news comes on the heels of several store closures and dips in sales from iconic retailers due to the COVID-19 pandemic. Neiman Marcus, the beloved luxury retailer may be next, according to WWD.
This article originally appeared on ELLE US.