Party City Files for Bankruptcy

42
SHARE

On January 18, 2023, it was released that Party City and at least twelve of its subsidiaries have filed for bankruptcy in Houston, Texas. Specifically, the United States Bankruptcy Court for the Southern District of Texas will hear the Chapter 11 petition. The presiding judge is United States Bankruptcy Judge David R. Jones, who began hearing the case today.

Party City claims that the bankruptcy is due to multiple factors, one of which being the Covid-19 pandemic and the lockdowns that followed it. The retailers being forced to shut down was a huge factor, as well as the astronomical inflation hitting the country and the stores specifically.

In addition to the bankruptcy, the company is looking to do what they call an “expedited restructuring that will allow the retailer to keep operating its roughly 800 stores while increasing liquidity and slashing debt.”

Within the company, there is approximately $1.4 in total obligations, which includes first lien loans, a credit facility, unsecured notes, and a “first in, last-out” credit facility.