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Party City reportedly holds bankruptcy talks

It has been reported in mainstream US media outlets that Party City is negotiating with creditors regarding restructuring.

A report from Bloomberg suggests that the retailer has sought funding for a potential Chapter 11 bankruptcy, according to people with knowledge of the preparations.

It is suggested that the company is preparing to enter bankruptcy protection within weeks and is sharing information with potential providers of debtor-in-possession financing.

The retailer recently reported that it had received a continued listing notification from the New York Stock Exchange, as it was no longer in compliance with the criteria, which requires listed companies to maintain an average closing share price of at least $1 over a consecutive 30-day trading period.

Late last year, the company also lowered its earnings outlook to $130 to $150 million from its initial guidance for 2022 of $275 to $300 million, and announced it was embarking on a cost-cutting plan of $30 million.

Party City cited the increased cost of helium and supply chain costs as the reasons for the fall in profit this year.

Party City buyers have unusually not been in attendance at this year’s Halloween & Party Expo, currently taking place in Las Vegas this week, adding to speculation that changes are afoot.

 

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