Charlotte Russe stores still open, but for how long?

Charlotte Russe Holdings Corp. is hoping a buyer will emerge but, if not, it is preparing for a possible liquidation — and sooner rather than later.

The bankrupt teen fashion retailer said that it is engaged in “active” discussions with prospective bidders for a sale that would allow it to continue to operate its brick-and-mortar and online platforms. At the same time, Charlotte Russe will simultaneously seek court approval of a "stalking horse" liquidation agreement with a contractual joint venture comprised of Gordon Brothers Retail Partners and Hilco Merchant Resources on February 20, 2019, in compliance with its postpetition financing milestones.

The retailer expects that competing bids will be due by March 3, 2019 and an auction will be scheduled for March 5, 2019. If an going-concern transaction is not selected as the highest or otherwise best bid following the conclusion of the auction, the company plans to conduct an orderly “wind-down” of all of its store locations and operations beginning on or about March 7, 2019.

Charlotte Russe filed for Chapter 11 bankruptcy on February 3, 2019, with plans to close about 95 stores while continuing to pursue a sale of its business and assets. The company operates more than 500 stores, including 10 under its Peek Kids banner. Charlotte Russe and its Peek stores and online platforms are currently open and continuing to serve customers.

Cooley LLP is serving as the company's legal counsel, Berkeley Research Group is serving as its financial advisor, and Guggenheim Securities is serving as its investment banker.