WASHINGTON — For the second time in less than a year, crafting retailer Joann has announced plans to declare chapter 11 bankruptcy.
The company announced on Jan. 15 that it was seeking court approval in Delaware to begin the process of selling “substantially all of its assets,” according to a press release about the move.
Joann’s more than 800 U.S. stores are expected to remain open while the bankruptcy process unfolds, alongside the Joann website. Employees will continue to receive pay and benefits, the company said.
“Since becoming a private company in April, the Board and management team have continued to execute on top- and bottom-line initiatives to manage costs and drive value,” said Michael Prendergast, the company’s interim CEO, in a statement. “However, the last several years have presented significant and lasting challenges in the retail environment, which, coupled with our current financial position and constrained inventory levels, forced us to take this step.”
Prendergast said he hoped the bankruptcy and subsequent sale would allow Joann to continue operating.
This is the second time Joann has declared bankruptcy in less than 12 months. In April 2024, the company completed a restructuring that saw it delisted from the U.S. stock exchange and become a private company as part of a bankruptcy deal.
When that bankruptcy process became public, the company owed over $2.44 billion, with about $2.26 billion in assets. It’s unclear if that debt had been paid down by the most recent filing, but Joann officials did note in their announcement that they company was seeking court approval to use cash collateral to ensure it had “the liquidity necessary to support its operations.”
The company, which was founded back in 1943, previously went private in 2011 — when it was purchased by equity firm Leonard Green & Partners for about $1.6 billion.
A decade later Joann, still majority owned by Leonard Green & Partners, went public in an initial public offering at $12 a share.