Muji files for bankruptcy in the US
The US arm of Japanese lifestyle brand Muji has filed for bankruptcy, joining a host of retail casualties amid the coronavirus pandemic.
Muji owner Ryohin Keikaku said it had filed for Chapter 11 bankruptcy protection today, aiming to close unprofitable stores and renegotiate rents across the US.
All of Muji’s 18 US stores have remained closed during the outbreak, shutting their doors in mid-March.
It marks the latest retailer to file for bankruptcy in the US due to the fallout from Covid-19, following closely behind menswear giant Brooks Brothers which filed yesterday.
Other US casualties include J Crew, JC Penney and Neiman Marcus. In the UK, the likes of Debenhams, Kath Kidston and TM Lewin have all gone under in recent months.
Ryohin Keikaku said the US filing will not affect its operations in other markets.
It listed assets and liabilities in the range of $50m to $100m, with the number of creditors estimated at 200 to 999.
But the business has also been hit by store closures and weak consumer spending in its main market of Japan.
The collapse in sales as its global store network closed its doors during the pandemic led Ryohin Keikaku to also report a net loss of ¥4.1bn (£30.5m).
In the latest fiscal year, sales from its US arm made up about 2.5 per cent of Ryohin Keikaku’s overall revenue.
The US business had been operating at a loss for the past three years, putting in a loss of around $10m last year.
Shares in Ryohin Keikaku in Tokyo fell 5.38 per cent on the announcement, dragging the Nikkei to a one-week low as local coronavirus cases spike in the country.