True Religion files for bankruptcy protection amid virus crisis

True Religion Apparel Inc on Monday filed for Chapter 11 bankruptcy protection for a second time in less than three years, becoming another corporate casualty of the coronavirus outbreak that has ravaged the retail sector.

In a court filing, the embattled denim retailer said it would have preferred to wait out the current period of lockdowns and instability in financial markets but “simply could not afford to do so”.

More than 95% of Americans are now under “stay-at-home” or “shelter-in-place” orders and retailers across the country have been forced to shutter stores to help contain the spread of the virus.

While public health experts said the steps are working to control the contagion, the restrictions have strangled the U.S. economy and sparked widespread production cuts, layoffs and projections of a severe recession.

Major U.S. retailers Macy’s Inc, Kohl’s Corp and Gap Inc have already furloughed tens of thousands of employees, amid drastic cost cutting steps to bolster cash reserves.

True Religion listed $100 million to $500 million in assets and liabilities in the court filing dated April 13.

Chief Executive Officer Michael Buckley said True Religion’s largest lenders were providing fresh capital to the company to reorganize under Chapter 11.

“In the near term, and until our stores open up, we will be continuing as we have, to run our E-Commerce businesses, in the same way we did prior to filing for Chapter 11,” Buckley said.