Party City, which surprised many last week when it announced it was going out of business, announced Monday that it will hold going-out-of-business sales at its approximately 700 stores nationwide.
The Woodcliff Lake-based company said the decision to close was made following efforts by the company to find a path forward that would allow continued operations in what it said was an immensely challenging environment driven by inflationary pressures on costs and consumer spending, among other factors.
To accomplish an orderly wind down in the most efficient manner and to maximize value for the benefit of the company’s stakeholders, Party City Holdco and certain of its subsidiaries voluntarily filed Chapter 11 in the U.S. Bankruptcy Court for the Southern District of Texas.
These proceedings follow the company’s 2023 restructuring through which Party City eliminated nearly $1 billion in debt, among other things. As with many other retailers, macroeconomic headwinds more recently proved too severe for the company to overcome.
The company has filed customary motions with the court seeking authority to commence going out of business sales and uphold its commitments to employees during the wind down. Party City’s senior lenders said the company has committed to providing the financial support necessary to fund operations through the wind down, subject to court approval.
