Off-price retailer Stein Mart declared bankruptcy on Wednesday and announced it would close most of its stores as the coronavirus pandemic continues to take a toll on the retail sector.
Stein Mart, based in Jacksonville, Fla., filed for bankruptcy of Chapter 11 protection and informed it has already begun with a closure and liquidation process of the store. The chain said that “an important part, if not all, of its brick-and-mortar stores” will be closed.
CEO Hunt Hawkins pointed to the pandemic as a reason for submitting and said “the best strategy to maximize value will be a liquidation” of the company’s assets. The company is also in talks about selling its e-commerce operations and intellectual property.
“The combined effects of a challenging retail environment, combined with the impact of the Coronavirus (COVID-19) pandemic, have created significant financial distress for our company,” he said.
“The company lacks enough liquidity to operate in the normal course of trade,” he added.
Stein Mart shares fell 35 percent after the announcement and were traded at 18 cents a share on Wednesday afternoon. The company has fallen more than 70 percent by 2020, CNBC reported.
The company currently operates nearly 300 stores in 30 states.
Stein Mart is joining a growing list of more than 40 retailers who have filed for bankruptcy in the midst of the pandemic after government shutdowns shut down retailers.
Other retailers such as home-goods chain Pier 1 Imports, department stores Neiman Marcus and JC Penney and clothing companies such as J.Crew, Brooks Brothers and Ascena Retail Group, which owns Ann Taylor, have all filed for bankruptcy.
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