Claire’s Accessories has hired London-based financial services company Interpath as a restructuring advisor to salvage its UK operations.

A go-to retail outlet for kids and tweens, Claire’s has an outstanding loan of more than US$478.5 million (£355 million), which must be repaid in full by the end of next year. Interpath will draw up a rescue plan for the chain that includes hunting for new investors to restructure its debt and finding a potential buyer to take over the business. 

Claire’s operates 2,300 stores worldwide, including 281 across the UK that have incurred more than US$33.7 million (£25 million) in losses over the last three years. The 64-year-old company has listed tariffs, inflation, higher transportation costs and a weakening labor force as factors driving these declines. 

No stranger to fighting for its survival, Claire’s filed for Chapter 11 bankruptcy in 2018 in a last-ditch effort to restructure its loans or start closing stores. It was acquired four years later by major creditors Monarch Alternative Capital and Elliott Management, which are now entertaining bids for the US operations to avoid bankruptcy for the second time in seven years. 

The potential for mass store closures could also impact the chain’s licensing business. Claire’s currently has partnerships in place with major kids brand owners including Disney (Minnie Mouse, Lilo & Stitch), Sanrio (Hello Kitty), Hasbro (My Little Pony), Mattel (Barbie) and The Pokémon Company International.