J. Jill, a leading US womenswear retailer, may now be able to avoid Chapter 11 filing, as it gets approval from lenders.
The approval will help the retailer extend certain maturities of its term loans.
The American fashion label had earlier said that it would file for bankruptcy if it failed to get any approval from lenders.
J. Jill got approval of lenders holding 97.8 per cent of its term loans to go ahead with out-of-court financial restructuring transaction, which will extend the maturities to May 2024.
The transaction is expected to close on or around 30 September.
Earlier this month, the retailer signed a deal with lenders who held 70 per cent of the debt to extend maturities to 2024 and also grant a financial covenant holiday – additionally providing at least US 15 million of cash as a junior term loan.
The retailer had earlier seen its second quarter sales slump by nearly 50 per cent to clock a disappointing US $ 92.6 million.
Back in June 2020, lenders had agreed to drop its plans of taking any action against J. Jill after the retailer had violated terms of its loans.
Like many fashion retailers, J. Jill too has been struggling to survive much before the pandemic started and COVID-19 finally managed to devour the retailer.