New York City — L’Occitane, Inc., a leading U.S. retailer of beauty and well-being products rich in natural and organic ingredients that preserves and celebrates the traditions of Provence, France, has filed for voluntary Chapter 11 bankruptcy this week and will optimize its store footprint to best position its business for the future.
To implement this store footprint optimization plan, including the contemplated exit of unprofitable locations, the company commenced a voluntary case under Chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court for the District of New Jersey. The filing does not include the L’OCCITANE en Provence brand or any operations outside the U.S.; parent company L’Occitane International S.A.; or any other group subsidiaries, including ELEMIS and LimeLife.
L’OCCITANE en Provence boutiques across the country are open and operating safely in accordance with all applicable COVID-related guidelines. The company has ample liquidity to support ongoing operations across all channels and fulfill commitments to its employees, customers and suppliers in the ordinary course during the restructuring of its U.S. store lease portfolio, which it anticipates completing in short order.
Despite L’Occitane’s success in advancing its strategy, including year-over-year growth in online sales, its business continues to be impacted by disproportionately high store rent obligations that are no longer tenable. The company determined that a Chapter 11 process was the necessary path to right-size its brick-and-mortar presence following repeated endeavors to engage with its landlords to address unmanageable store lease terms.
“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. “Over the past year, we have moved aggressively to address COVID-related challenges head on, developing innovative new ways to connect with our community and continue to deliver the extraordinary L’Occitane beauty experience that our customers know and love, all while accelerating the essential transformation of our store footprint already underway. We look forward to working collaboratively with our landlords to achieve partnerships that make economic sense in this current retail environment and best position our marquee brand’s boutique offering for years to come.”
Additional information about L’Occitane’s lease portfolio restructuring, including court filings, is available at https://cases.stretto.com/LOccitane.
Fox Rothschild LLP is serving as legal counsel, RK Consultants LLC is serving as financial advisor, and Hilco Real Estate, LLC is serving as real estate advisor to the company.
Founded by Olivier Baussan more than 40 years ago, L’OCCITANE captures the true art de vivre of Provence, offering a sensorial immersion in the natural beauty and lifestyle of the South of France. L’OCCITANE products are available at www.usa.loccitane.com and in boutiques throughout the U.S.
To read Retail & Restaurant Facility Business’ October 2018 cover story of L’OCCITANE en Provence, click here.
SOURCE: L’Occitane, Inc.