ALDO SHOE COMPANY FILED FOR BANKRUPTCY

It became known that the Canadian shoe and accessories retailer ALDO Group Inc. has filed for the protection from the bankruptcy proceedings. It was done in order to restructure and stabilize the business in the future.

Aldo filed a voluntary application, stating that the coronavirus pandemic caused too much pressure on the business and cash flows - two major financial transactions failed in March due to the crisis. It is assumed that as part of the bankruptcy protection procedure, the company will be reorganized.

The bankruptcy process has already begun in Canada and the similar measures will be taken in the USA and Switzerland. The CEO of Aldo, David Bensadoun, said that after analyzing the strategic alternatives, the current solution was the only one that would save the company and would let to survive a difficult period.

“With our rich heritage of shoe fashion, an experienced leadership team, extensive capabilities and a client base, we firmly believe that we will get out of the restructuring process. We will get out and continue to be leaders in retail”, said Bensadoun.

The company has 3,000 stores and 8,000 employees around the world, some of which will be dismissed. Aldo's debt is estimated at $ 214 million, and it should be repaid by October 2022. Apparently, the company doubts the reality of paying off the debt, given that there are two more years ahead.

David Bensadoun named four key business segments that should remain: stores, e-commerce, franchising and wholesale. Until recently, retail accounted for 50% of the business, while the remaining categories collectively accounted for only a half.