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The U.S. division of French beauty products maker L’Occitane International SA has filed for bankruptcy, behind on $15 million in rent and seeking to shed lease obligations after the COVID-19 pandemic cut into sales, WSJ Pro Bankruptcy reported. The U.S. unit L’Occitane Inc., which operates 166 boutiques in 36 states and Puerto Rico, filed a chapter 11 petition Tuesday in the U.S. Bankruptcy Court in Trenton, N.J., for the purpose of relieving itself of what it called increasingly untenable lease obligations. Like other retailers, L’Occitane has been hurt by the pandemic, which has made consumers less willing to shop in person, according to a declaration filed in bankruptcy court by Yann Tanini, regional managing director for L’Occitane. The company filed court papers seeking to reject 29 “burdensome” lease agreements and exit from those locations, where it said its rent obligations “no longer reflect the market.” L’Occitane joins the ranks of a growing number of retailers, from huge department-store chains such as J.C. Penney Co. to boutiques like Sur La Table Inc., to have filed for chapter 11 during the pandemic. Even before the onset of COVID-19, L’Occitane experienced a decline in sales at its bricks-and-mortar stores, while revenue from e-commerce increased, but the pandemic intensified the trend. The pandemic has forced L’Occitane to “more aggressively address the rapidly widening gulf between its brick-and-mortar retail revenue and its substantial lease obligations, which no longer reflect the market,” Mr. Tanini said. L’Occitane tried to renegotiate lease terms with its landlords in hopes of completing an out-of-court restructuring. Landlords were reluctant to offer concessions sufficient for the company to remain viable, according to Mr. Tanini.

Cici’s Holdings Inc., which operates and franchises the Cici’s Pizza buffet chain, and affiliated companies have filed for chapter 11 bankruptcy protection which involves the company’s sale to real estate company D & G Investors LLC, National Restaurant News reported. In Jan. 25 filings in the United States Bankruptcy Court for the Northern District of Texas, Cici’s said the company owned 12 Cicis Pizza locations and franchised approximately 306 others to 128 franchisees. It said the chain’s wide variety of pizza, pasta and salad bar offerings made it a popular venue for large family and other gatherings. “Moreover, CiCi’s asset-light business model, which is grounded in its franchise model and distribution system, historically enabled CiCi’s to generate significant free cash flow with low capital expenditure requirements,” it said. It added that in its 2019 fiscal year, it generated $14.2 million in adjusted EBITDA on revenue of around $177.3 million. As a result of the pandemic, however, accompanied by related government occupancy restrictions and a decrease in consumer demand, the company’s revenue declined to $76.3 million resulting in an adjusted EBITDA loss of $2.7 million. As of Dec. 11, 2020, Cici’s Holdings had a total debt of $81.64 million. At the time of the bankruptcy filing, a total of 214 restaurants had closed, of which 67 had closed permanently, including 6 company-owned locations.

Shares of videogame retailer GameStop Corp surged another 130% on Wednesday in pre-market trading as amateur investors continued to pile into the stock that has skyrocketed nearly 700% over the past two weeks, Reuters reported. The share spikes in GameStop and others including BlackBerry Ltd, headphone maker Koss Corp and Nokia Oyj, have sent short-sellers scrambling to cover losing bets, while raising questions about potential regulatory clampdowns. The top securities regulator in Massachusetts thinks trading in GameStop stock, which has jumped to $148 a share from $19.95 since Jan. 12, suggests there is something “systemically wrong” with the options trading surrounding the stock, Barron’s reported on Tuesday. GameStop, BlackBerry and Nokia were among the most heavily traded U.S. stocks before the bell, with analysts putting the moves partly down to herds of amateur investors chasing tips from Reddit discussion threads or the private Facebook group “Robin Hood’s Stock Market Watchlist”. “These are not normal times and while the (Reddit) r/wallstreetbets thing is fascinating to watch, I can’t help but think that this is unlikely to end well for someone,” Deutsche Bank strategist Jim Reid said. Trading in GameStop stock was halted for volatility nine times on Monday and five times on Tuesday. Short sellers in GameStop are down $5 billion on a mark-to-market, net-of-financing basis in 2021, which included $876 million of losses early Tuesday, according to analytics firm S3 Partners.

Sycamore’s Belk Inc. is nearing a deal to file for bankruptcy with plans to hand an ownership stake to lenders, Bloomberg News reported. The deal would take the department store chain through a pre-arranged restructuring of its debt, said the people, who asked not to be identified discussing the private talks. The terms aren’t final and could still change. The company has been working with Kirkland & Ellis and Lazard Ltd., Bloomberg earlier reported, while Willkie Farr & Gallagher and PJT Partners Inc. are advising a so-called crossholder group that includes large second-lien loan holders along with first-lien lenders and is led by Blackstone Credit. Department stores have struggled as shoppers have defected to specialized retailers and new online competitors. Closures because of COVID-19 and customers’ reduced desire to shop amid the pandemic have only heightened the pain. To cope with the situation, Charlotte, N.C.-based Belk delayed and halted payments to some vendors, Bloomberg previously reported. William Henry Belk opened his first store, called The New York Racket, in 1888. The mid-priced chain bought up other department store locations, primarily in the South, to grow to almost 300 locations in 16 states.

Shares of AMC Entertainment Holdings Inc. rose almost 26% after the movie theater giant said it signed deals for $917 million in financing to survive the COVID-19 pandemic for months longer without resorting to bankruptcy, WSJ Pro Bankruptcy reported. Investment deals signed by the embattled movie theater chain have brought in $411 million in debt financing and $506 million in equity since mid-December as AMC took advantage of equity markets’ robust appetite for risk and a thirst for returns in fixed income that has driven yield on the riskiest junk debt to record lows. Investors have proven willing to support struggling companies during the pandemic, even those that have been hit hard by social-distancing and travel restrictions, such as theaters, cruise lines and hotels. The rollout of COVID-19 vaccines has given investors incentive to keep beaten-down companies like AMC afloat and help them avoid a costly debt default or bankruptcy, though the sluggish vaccination rollout also poses a risk. With the deals announced yesterday, AMC Chief Executive Adam Aron said that the possible bankruptcy filing the company had previously warned about was now “completely off the table.” The company said its financial runway has now been extended deep into 2021 and that while an increase in cinema attendance seems likely, the future course of the coronavirus meant that cash needs remained uncertain.

Shares of U.S. videogame retailer GameStop skyrocketed by 144% yesterday as short sellers scrambled to cover their positions in the stock, which then pared gains in a roller coaster session that featured nine trading halts for volatility, Reuters reported. Options activity also surged in the stock, which had gained 245% so far this year as of Friday’s close. It closed Monday’s session up 18% with $16.7 billion worth of GameStop shares traded — more than triple the company’s actual stock market value. Short sellers had bet against the stock because they viewed GameStop’s retail business model as outdated. But GameStop shares began to rise after the video game retailer’s announcement on Jan. 11 about appointments to its board to double down on digital sales. The buying frenzy as short sellers rushed to cover positions enticed retail investors to pile on in hopes of riding the stock’s momentum higher.

Movie theater giant AMC Entertainment Holdings Inc. signed deals for $917 million in financing to survive the Covid-19 pandemic for months longer without resorting to bankruptcy, the Wall Street Journal reported. AMC, the world’s largest movie theater chain, said it had executed a commitment letter for $411 million in debt financing through increasing the size of and refinancing a European credit facility while raising $506 million in equity since mid-December. “This means that any talk of an imminent bankruptcy for AMC is completely off the table,” said Chief Executive Adam Aron. The company had warned about its risk of bankruptcy since late last year. With the deals, AMC said that its financial runway has now been extended deep into 2021 and that while an increase in cinema attendance seems likely, the future course of the coronavirus means the company’s cash needs remain uncertain. The company also said that it presumed it would continue to make progress in negotiations with theater landlords over lease payments. Investors have been willing to keep AMC afloat even as it burned cash and theaters stayed largely dark as infections surged late last year. The pandemic has hit AMC hard as restrictions on indoor gathering forced the company to temporarily close most of its more than 1,000 theaters world-wide. AMC and its peers also face a challenge from major Hollywood studios that have either delayed releasing films or released them straight to streaming services during the pandemic, leaving cinemas with little content to show those viewers willing and able to brave a trip to the big screen. Warner Bros. said earlier this month that it would release its entire 2021 slate of films simultaneously in theaters and on its HBO Max streaming service, a drastic step in eliminating the exclusivity that theater chains have enjoyed for decades.

One year after the coronavirus pandemic first disrupted global supply chains by closing Chinese factories, fresh shipping headaches are delaying U.S. farm exports, crimping domestic manufacturing and threatening higher prices for American consumers, the Washington Post reported. The cost of shipping a container of goods has risen by 80 percent since early November and has nearly tripled over the past year, according to the Freightos Baltic Index. The increase reflects dramatic shifts in consumption during the pandemic, as consumers redirect money they once spent at restaurants or movie theaters to the purchase of record amounts of imported clothing, computers, furniture and other goods. That abrupt and unprecedented spending shift has upended long-standing trade patterns, causing bottlenecks from the gates of Chinese factories to the doorsteps of U.S. homes. At the Port of Los Angeles one day last week, 42 ships were anchored offshore, waiting to unload their cargoes, even as every warehouse within 60 miles was already full. A shortage of dock workers amid California’s worsening coronavirus outbreak is further complicating operations; inbound cargo volumes in December were more than 23 percent higher than one year earlier.

Specialty retailer Francesca’s Holdings Corp. has won court approval to sell its remaining business out of bankruptcy to a group of buyers that plan to keep open about half of the chain’s roughly 550 stores, WSJ Pro Bankruptcy reported. Judge Brendan Shannon of the U.S. Bankruptcy Court in Wilmington, Del., said on Thursday he would approve the sale of substantially all of Francesca’s assets to an affiliate of investment firm TerraMar Capital LLC and appraisal and liquidation firm Tiger Capital Group LLC, one of Francesca’s lenders. “This is a frankly very, very welcome result,” Judge Shannon said during a hearing Thursday held by video. “This is an extraordinarily challenging environment and to come up with competing, going concern sales and the opportunity for a robust auction, that would not have been anyone’s likely prediction at the outset of this process.” Los Angeles-based TerraMar, which served as the lead bidder along with Tiger, agreed to a purchase price of $18 million in cash, subject to certain adjustments, plus a promissory note for $1.25 million and the assumption of about $7.74 million in liabilities. The deal, which could close by next week, will preserve the business as a going concern with at least 275 Francesca’s boutiques. As of Tuesday, Francesca’s operated 551 locations, mostly in malls across the U.S. About 140 stores were shut before Francesca’s filed for chapter 11 bankruptcy in December.