Not long ago, at malls and strip centers across Illinois, shoppers could count on finding Dress Barns, Lane Bryants, Ann Taylors, Justices and other apparel stores run by Ascena Retail Group. Five years ago, the retailer operated nearly 5,000 bricks-and-mortar locations catering to women, teens and tweens. As of 2020, that number had been halved and the bankrupt chain has agreed to sell off its surviving stores.
Fashion apparel is a tough business for any merchant, given powerful e-commerce competition and the effects of the pandemic on all retail sectors. In the case of Ascena, some of its wounds were self-inflicted, and the efforts of its leaders to avoid a courtroom reckoning have turned its bankruptcy case into a landmark. We hope the U.S. Supreme Court will take notice.
Ascena’s troubles began in 2015, when it paid more than $2 billion for Ann Inc., parent of Ann Taylor, Loft and other retail clothing chains. Over the next two years, executives at the then-publicly held company told investors on at least several occasions that business was going well. In May of 2017, Ascena warned of trouble ahead and its stock plunged. Weeks later, it took a $1.3 billion restructuring charge, and the operation only went downhill from there.
