Alex and Ani, the Rhode Island bangle maker that when rocketed to retail acceptance behind spirituality and appeal bracelets, has submitted for Chapter 11 personal bankruptcy security.
The corporation, which had been mired in sales slumps, lawsuits and inner conflict, explained it will keep on to operate while operating with lenders and restructuring all through the personal bankruptcy proceedings.
“In 2020, COVID-19 pressured the corporation to pause its vital strategic development initiatives, briefly close merchants and scale again its functions in light of lowered in-retail outlet shopper demand,” Robert Trabucco, Alex and Ani’s chief restructuring officer, mentioned in a statement. “By using the Chapter 11 course of action, we are in a position to make sure an expedited and orderly correct-sizing of our harmony sheet and functions.”
Now managed by a British personal equity company, Alex and Ani has in between $100 million and $500 million in money owed to hundreds of collectors, according to the submitting in U.S. Individual bankruptcy Courtroom in Delaware. The enterprise lists assets in a similar selection.
The bankruptcy filing Wednesday is the most current setback for Alex and Ani, which went from Cranston startup to all-conquering brand a ten years back.
Founded in 2004 by College of Rhode Island graduate Carolyn Rafaelian in her father’s Cinerama jewelry factory, Alex and Ani bought collectible bangles that would attach to inexpensive, expandable charm bracelets.
In 2010, the corporation employed former state Sen. Giovanni Feroce as CEO and about the upcoming several a long time opened much more than 100 outlets throughout the place and purchased a Tremendous Bowl industrial. Feroce left the company along with a substantial chunk of its executives abruptly in 2014.
Together with bangles, Alex and Ani was acknowledged for its New Age ethos and “constructive electrical power” branding. Products and solutions had been blessed by a shaman just before heading to suppliers.
In 2017, Forbes ranked Rafaelian the 18th-richest self-made girl in the United States, with a net well worth of much more than $1 billion.
But it wasn’t very long ahead of deep cracks would start out to demonstrate in the organization.
By 2019, Alex and Ani was cutting charges and falling behind on payments to vendors as profits fell.
In July 2019, Alex and Ani sued Lender of The united states, accusing the loan provider of gender bias and forcing the organization into a “demise spiral” by positioning it into default of a personal loan.
By final yr, Rafaelian was pressured to give up handle of Alex and Ani to investor Lion Capital, which now controls 59% of the company, according to bankruptcy files.
Alex and Ani no extended has any Rhode Island outlets, but is headquartered at 10 Briggs Travel in East Greenwich.
Far more:Alex and Ani sues Financial institution of America, claims bias activated ‘death spiral’
Alex and Ani’s most significant unsecured creditor — owed $4.1 million — is the Carpionato Team, operator of Chapel View buying intricate in Cranston, the place Alex and Ani’s headquarters was when positioned.
Alex and Ani also owes Brookfield Properties, which owns the Providence Put shopping mall, $3.3 million Top quality Spray Systems of Providence $3.3 million National Chain Business of Warwick $545,000 and the City of East Greenwich $176,000.
The bankruptcy submitting also lists at minimum two “charitable donations payable,” such as $254,000 to the David Lynch Foundation.
“Our staff will carry on to be paid out as typical during this course of action. The organization will search to improve its retail footprint, bolster the eCommerce platform and focus on strategic wholesale accounts,” Trabucco said.
On Twitter: @PatrickAnderso_