The Container Store, a prominent retail storage and organizational solutions company, filed for Chapter 11 bankruptcy, citing the impact of reduced consumer spending on discretionary items.
The 46-year-old company announced Sunday that bankruptcy protection would support its financial restructuring, enabling long-term growth and profitability.
In its court filings, the retailer disclosed $230 million in debt with only $11.8 million in cash on hand. However, it has secured $40 million in new financing to face the bankruptcy process.
Despite the filing, the company assured customers that its 102 physical stores and online platform would remain operational and that the entire process is expected to be completed within 35 days.
“The Container Store is here to stay,” said CEO Satish Malhotra, adding: “Our strategy is strong and we believe the steps we are taking today will allow us to continue advancing our business, deepen customer relationships, expand our scope. and strengthen our capabilities.”
The company confirmed that payments to sellers and suppliers would continue as usual and that all customer deposits and orders would be accepted. It also revealed plans to transition to a private entity following Chapter 11 proceedings.
Notably, the Sweden-based company's Elfa brand, known for its premium and customizable storage systems, is excluded from the bankruptcy process.
The filing coincides with uncertainty over a recent deal involving Beyond, the parent company of Bed Bath & Beyond and Overstock.com. Under the agreement, Bed Bath & Beyond brand products would be sold at Container Store outlets. However, financial problems have reportedly put the deal in doubt.
Compounding its problems, shares of The Container Store were delisted from the New York Stock Exchange after failing to meet the exchange's financial standards.
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