L’Occitane said in a press release that “its business continues to be impacted by disproportionately high store rent obligations that are no longer tenable,” making Chapter 11 necessary to speed store closures.
In court papers, Yann Tanini, managing director of L’Occitane North America, said that the retailer’s lease obligations amount to $30.3 million annually. It currently has $15.1 million that is in arrears, and landlords are withholding more than half a million dollars in security deposits.
“[T]he Debtor’s primary goal in chapter 11 is to right-size its physical footprint in part by rejecting certain leases to enable the Debtor to better adapt and cultivate sustained profitability in light of the increasing shift to online purchasing and the impact of the COVID-19 pandemic on brick-and-mortar retail sales,” Tanini said.
Source: Retail Dive