Forever 21 Taps Lazard, Kirkland for Restructuring Advice

(Bloomberg) -- Forever 21 Inc. has added investment bank Lazard Ltd. and law firm Kirkland & Ellis to its roster of advisers as the fashion chain tries to turn itself around, according to people with knowledge of the situation.

The retailer is looking for ways to avoid becoming another victim of an industry slump that has seen a series of chains shutter stores or go out of business. A spokeswoman for Forever 21 declined to comment. Representatives for Lazard and Kirkland & Ellis didn’t provide comment.

Management has been busy over the past few weeks, holding discussions with lenders including Apollo Global Management LLC and interviewing potential advisers. Forever 21 is exploring financing that would shore up its liquidity and ensure co-founder Do Won Chang maintains control, people with knowledge of the matter said earlier this month.

The company, based in Los Angeles, focuses on younger shoppers looking for trendy clothes at affordable prices. Competitors from Hennes & Mauritz AB to Target Corp. to new online sellers have crowded into its niche, weighing on profits. Founded in 1984, Forever 21 now operates more than 800 stores in the U.S., Europe, Asia and Latin America, mainly in the U.S.

Any pullback by the company could add to pressure on retail landlords, who are already reeling from rising vacancies as stores have gone bankrupt, sold off outlets or both. This year, Payless Inc. elected to liquidate its North American operations, while Ascena Retail Group Inc. decided to wind down its Dressbarn clothing chain. Shopping centers and Main Streets are pocked with empty storefronts.

Forever 21 rents mall space from Macerich Co., Taubman Centers Inc., Simon Property Group Inc. and the Pennsylvania Real Estate Investment Trust, among others, according to filings.

To contact the reporters on this story: Eliza Ronalds-Hannon in New York at eronaldshann@bloomberg.net;Lauren Coleman-Lochner in New York at llochner@bloomberg.net

To contact the editors responsible for this story: Rick Green at rgreen18@bloomberg.net, Dan Wilchins, Christopher DeReza

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