CALIFORNIA – Joann announced, January 15, that it filed for Chapter 11 bankruptcy in a Delaware court to help sell its business and get the best value.
There are over 75 Joann stores in California with more than 800 stores across the U.S. offering sewing, fabrics, arts and crafts products.
This is the company’s second bankruptcy filing. Joann said after the first Chapter 11 restructuring in 2024, it continued to experience significant and lasting challenges in the retail environment.
Joann’s interim CEO Michael Prendergast said the tough times in retail, along with financial struggles, and low inventory forced the company to take this step.
“After carefully reviewing all available strategic paths, we have determined that initiating a court-supervised sale process is the best course of action to maximize the value of the business,” said Prendergast.
According to the news release, Joann stores and Joann.com are open and continue to serve customers. Team members are continuing to receive pay and benefits.
Joann says buyer intends to close all stores
The court documents show that Joann’s liabilities range from $1 billion to $10 billion.
The company is asking the court to approve the sale of most of its assets. Gordon Brothers Retail Partners, LLC has been chosen as the “stalking horse” bidder, setting a baseline offer to attract other potential buyers.
Joann says Gordon Brothers intends to shut down the stores and sell everything in going-out-of-business sales.
Joann says it is looking for other offers and has heard from parties who might want to keep the stores and online business running.
Gordon Brothers says 200 Big Lots stores will remain open
Gordon Brothers recently announced the purchase of Big Lots after the company announced it would be closing all locations and starting going-out-of-business sales.
The purchasing terms include preserving the brand with at least 200 stores that will operate under the Big Lots name and retain the employees needed for continued operations.
