With debts exceeding $2.44 billion, US retail giant Joann files for bankruptcy

It is learned that on March 18, according to foreign media reports, American fabric and handicraft retailer Joann has filed for bankruptcy protection under Chapter 11 of the U.S. Bankruptcy Code due to long-term financial difficulties. Its more than 800 stores and its website will continue to operate normally.

It is understood that Joann has a history of more than 80 years, mainly selling fabrics and handicrafts. In 2020, the consumption of handicrafts emerged, and Joann's business volume surged. As consumer enthusiasm has faded in the past two years, Joann's sales have declined. Joann's December financial report showed that its third-quarter net sales fell 4.1% from the same period last year, and its long-term debt was about US$1.2 billion.

In addition, Joann faces fierce competition from other retailers. Its competitor Hobby Lobby stimulates consumption through low prices, while retail stores such as Target and Walmart have rich categories of craft goods. Under this influence, Joann's market share gradually decreased, and it reorganized the company in September 2023 and laid off many employees.

It is understood that Joann listed a total debt of more than $2.44 billion and total assets of about $2.26 billion in its bankruptcy protection petition. Currently, Joann has obtained about $132 million in new financing, and it is expected that the financing debt will be reduced by about $505 million. Joann may get rid of bankruptcy as early as the end of next month. After this reorganization, Joann will become a private enterprise and delist from the stock exchange.

Editor ✎Rayna/

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